This is purely and acronym, transliterated to D.A.E.SH (the SH being a single letter in Arabic). As with all acronyms, its pronunciation is arbitrary, and determined mostly by predominant pronunciation. I would assume it to be two syllables: 'Da' and 'esh'. The second syllable may vary in sound by geographic region within the Arabic speaking world. For English speakers, I feel that any two syllable rendition is reasonable.
Just remember the word by thinking, "daeshbag" ; that way you'll never use the one they want us to use.