Hey patnaik,
I think GPL causes a lot of problems regarding code such as PHP as "including" the file can effectively be considered making the code part of the software. So I think your interpretaton of the license is not correct, that as long as we don't modify htmLawed we can incorporate it in a proprietary system.
http://www.gnu.org/licenses/gpl-faq.html#GPLInProprietarySystem
"You cannot incorporate GPL-covered software in a proprietary system. The goal of the GPL is to grant everyone the freedom to copy, redistribute, understand, and modify a program. If you could incorporate GPL-covered software into a non-free system, it would have the effect of making the GPL-covered software non-free too. "
If you want to achieve the goal you just mentioned above, I would suggest releasing the code either under the Apache (preferred) or LGPL (still has some issues) license.
In general GPL type licences really don't work well with commercial software.
http://chrisdail.com/2008/04/08/commercial-software-and-open-source-licensing/
I'd love to hear your thoughts on this.