Why were the Ottoman Turks during this time period relatively tolerant of religions other than Islam while the Europeans were definitely not tolerant of any religion other than their particular type of Christianity?

For the early Ottoman rulers, religious tolerance proved an excellent political choice, as it facilitated Ottoman expansion in Europe. Throughout the Balkans, Cyprus, Crete, and Greece, society at that time was religiously divided; the Catholic nobility generally ruled over Greek or Slavic Orthodox peasants and artisans. Various western Catholic states, especially Venice, established control over many locations in the Eastern Mediterranean after the crusaders sacked Constantinople (1204) and established the Latin Empire and divided the remnants of Byzantium among themselves. The restored Byzantine Empire (1261–1453) was a mere shadow of its former self and never managed to recapture most of its lost territories.
Persistent weakness drove the late Byzantine rulers towards union with Rome, which promised to help Byzantium fight off the Turks if the Byzantine Church would accept the authority of the pope. Many Eastern Orthodox people, including influential religious and political figures, resented the imperial readiness to accept Catholicism. They considered Catholics heretics and regarded them as greedy and aggressive; some Eastern Orthodox people openly declared that Ottoman domination would be preferable to Catholicism. As a result, when the Ottomans conquered the Southern Balkans in the late fourteenth century, the reasonably tolerant Muslim rulers could count on at least some of the Orthodox Slavs and Greeks to accept them as a lesser evil compared to Catholic rule.
Sufi dervish orders exercised a strong influence on the early Ottoman rulers and shaped their religious policy. The Sufis were generally quite tolerant towards other faiths, as they believed in the universality of mystical religious revelation. As a result, Ottoman policy generally allowed members of other religions, especially Christians and Jews, to maintain their religious identities with little discrimination.
That minimal discrimination benefited the government substantially and provided a huge economic incentive to welcome millions of loyal non-Muslim subjects. As non-Muslims, they had to pay the jizya tax. They also provided thousands of boys (one in every five boys per village) to the Sultan’s army, which converted them to Islam and then raised and educated as future Ottoman officials or soldiers. These ex-Christian soldiers made up the famous Janissary corps, the shock troops of the Ottoman army.