One of my favorite troublemakers, mynym at Into Good and Evil, has a nice short piece on the Nazi socialist’s view of church and state, as contrasted with Alexis de Tocqueville’s view that a state that supports rather than supresses religious life leads to national prosperity.
The key is, we must be careful to not let atheistic, materialistic scientism claim the entire ground as far as truth-telling goes, and we must be careful in our zeal for truth unfettered by supertition that we dont’ suppress religion.
Also, we must put away the false notion that "all religions are equally true or untrue, and we can not support one over the other." We must see this canard for what it is – intellectual foolishness, cowardice, and stupidity. Some religions obviously lead away from values we cherish – like life, liberty, equality, and the pursuit of happiness (I can hear the pro-gay readers sharpening their retorts about how xianity supresses their equality and pursuit of happiness).
Regarding just how we legislate moral issues, the answer seems clear. Some things are obvious (race and gender equality, the evils of slavery, child prostitution, murder, etc.), while others are arguable (legalization of alcohol, tobacco, marijuana, gay marriage, polygamy, governement support of questionable (or any) art, govt support of faith-based organizations or schools). These latter must be handled carefully, with enough legislation to allow personal choice, but not so much that we are officially sanctioning such things. I admit, however, that each of these "gray zone" matters is not easy to grapple with. But that’s why we have blogs ;)