I just reached the correct level person at the Alabama Dept of Revenue who was knowledgeable and who stated that the booklet is wrong and that you CAN TAKE MIP as a deduction under Miscellaneous Itemized deductions NOT subject to 2%.  Alabama is tied to the Federal so as long as it is deductible on the Federal return it is deductible on Alabama.

Therefore Intuit ProSeries IS HANDLING IT CORRECTLY ON ALABAMA FORM 40, SCHEDULE A

Sorry for the alarm!