Heaven and Hell in Islam
I hope that this hasn't confused you! Turning now directly to your question, Muslims are quite clear that Heaven and Hell have existed even before the creation of the world. They are both permanent places.
A translation of what we read in the Qur'an tells us this:
*{"Surely, We [Allah] have prepared for the evildoers a fire, whose pavilion encompasses them. If they call for help, they will be helped with water like molten copper that will scald their faces. How dreadful a drink and how evil a resting place.}* (Al-Kahf 18: 29)
Allah says (interpretation of the meaning):
"But those who disbelieve (in the Oneness of Allah), for them will be the Fire of Hell.
Neither will it have a complete killing effect on them so that they die, nor shall its torment be lightened for them. Thus do We requite every disbeliever!" [Faatir 35:36]
In another part of the Qur'an, we read:
*{Certainly, Allah has cursed the unbelievers and prepared for them a blazing fire to dwell therein forever, they shall find neither protector nor helper. On the day when their faces are turned about in the fire, they shall say, "Would that we had obeyed Allah and obeyed the Messenger!"}* (Al-Ahzab 33: 64-66)
There are other descriptions of Hell that are graphically horrific. Muslims believe that some people will be sent to Hell for all eternity, because we are told so in either the Qur'an or in the sayings of the Prophet (peace be upon him). They will never leave. Some of these people are actually mentioned by name.
According to authorities in Hadith like Al-Bukhari and Muslim, such people include Abu Lahab, `Amr ibn Luhai Al-Khuza`i, and others. Those who aren't identified by name are identified by description: every unbeliever, polytheist, or hypocrite (those who pretend they are Muslims but are not.)
All Muslims in Heaven?
As for your assertion that all Muslims will go to Heaven, we must, of course, add the words, in sha' Allah. We can never presume Allah's actions towards us. Only He knows the true intentions of our hearts.
Given this proviso, however, we do believe that Muslims will go to Heaven, even though they may have committed terrible crimes while they were alive. Muslim belief about this is as follows:
When a person dies, he or she will be laid in the grave. The Prophet told us that in the grave, all people will be questioned in the grave about their belief. They will sit up and answer the angels' questions. The believers will answer, "Allah is my Lord, Islam is my religion, and Muhammad is my prophet." The unbelievers will say, "I do not know. I heard the people saying something and I said it."
Once again, Prophet Muhammad is recorded to have said many things about this. Those Muslims who led good lives, obedient to the will of Allah, will rest in comfort in the grave, awaiting the Day of Judgment. Those Muslims who led bad lives, or who were Muslim in name only, will be punished severely in the grave.
In the Qur'an, we read:
*{If you could only see when the evildoers are in the agonies of death and the angels are stretching out their hands, saying, "Give up your souls! Today you shall be rewarded with the punishment of humiliation for what you used to say untrue about Allah, and for scornfully rejecting His signs."}* (Al-An`am 6 :93)
On the Day of Judgment, all people will be raised from their graves and their lives will be placed before them. They will have to give an account of how they lived. Good deeds will be weighed against bad deeds.
Once people's deeds have been weighed up and the remaining balance is in their favor, they will then have to give justice to those they offended in this life. If they offended someone, some of their remaining good deeds will be transferred to the offended.
If, after all this, their good deeds weigh as much as even just an atom, they will, in sha' Allah, enter Paradise. If, on the other hand, their good deeds have been exhausted in making up for wrongs they did to others, the offended will transfer some of their bad deeds, so that they go to Hell and suffer not only for their own bad deeds but also for the bad deeds of those they offended.
Allah knows what is best. As Muslims we believe that some Muslims will enter Hell and will remain there being punished until such time as Allah allows them to be released.
Not Temporary, But Relief Is Possible
This is not a temporary Hell. Hell is a fixed, permanent place, but Allah may allow some Muslims to be released from it because of His mercy.
We believe that the Prophet will be allowed by Allah to intercede on behalf of some believers who are in Hell, and by Allah's will they will be taken out of Hell.
Allah will also take out of the Hell some believers, not because someone has interceded on their behalf, but simply because He chooses to.