Personally, I don't really freak out at Nativity scenes. I don't mind them---whatever. But I think that there is a deeper issue under this, and possibly a constitutional one.
A large portion of our politicians don't believe in the separation of Church and State. There is an ever present battle being waged, and certain things become symbolic of that battle. Like Big Bird. Big Bird will live even if govt quits supporting him. It's not Big Bird, but a clash of ideologies.
This is a clash of ideologies, and frankly, the right thing would be for govt not to support one religion over another. If the Christian right was not painting every Muslim as a terrorist, trying to slip ID into schools, and trying to legislate their morality on the rest of us, perhaps such displays would not rankle as much. But that's what they are doing, so every small battle is elevated.
I confess, I have not yet read the article, and I will do so, but I just wanted to post on the issue. Some are saying that it is not the Atheists that started the trouble, but the Christians, and the headline was meant to mislead and stir up feelings against angry, petty atheists.
I have a friend that is a Pagan. Her mayor proposed that their city motto should be The Most Christian City in the USA, or something along those lines. These appear to be small battles, but they are linked to a much larger issue.