well, it certainly ought to be doable. Basically every language used by Moslems from Morocco to Pakistan from southern Africa to the central Asian steppes used some variant of the Arabic alphabet, and as you pointed out, the Bosnians did too. 1941 as a date for outlawing the script is awfully late OTL, if it survived that long we might even be able got get away with a POD after 1900.
At a guess, the biggest problems might be 1) the dominent Christian elite (whether Serbian Orthodox or Austrian Catholic) 2) the nationalist expansionist proto-empires.
1) the Serbs didn't dare be too too horribly oppressive to the RC Croats, as if things got TOO bad, they could call in the Austrians. The muslim Bosnians have the protection of ... ?Albania? (since the Ottomans are whom everyone else in the Balkans were rebelling AGAINST). Similarly, I suppose that Serbian communities in RC lands could call on Serbia for help if too oppressed.
2) If a truly federative *Yugoslavia (rather than a re-branded Greater Serbia), possibly including parts of, say, Bulgaria, formed, then there might be greater respect for various minorities, and the Bosnians might keep their own script.
OTOH, Cyrillic and Latin letters are closely related (both being ultimately descended from Greek), and it's really not that hard to learn the one knowing the other - so, e.g. reading signs on a trip isn't that hard. A semi-Arabic alphabet would be a lot harder, so might make it harder for commerce?