This will be the last I have to write on this. It's sucked up too much attention from the Iran negotiations and police misconduct/shootings stories/studies that I'd prefer to be paying attention to instead as there's very little actually happening.
First. My understanding of the law (the original, not including the clarifying aspect) is that it does not actually protect the baker-florist-photographer example, much less more than that like a hotel denying accommodations, with a religious disclaimer to any discrimination claim. RFRA's primary use was religious practices intersecting with government regulations (traditional drug use, beards, etc) and isn't primarily useful in overriding significant government interests, like discrimination arbitration.
Which is to say that the law as written did not actually accomplish much. Neither the supporters pushing for its passage or the opponents demanding boycotts of the state seemed to have understood this. Suggesting the law was poorly thought out, surely, though that is not that unusual.
The problem there is not the RFRA process, but the lack of anti-discrimination laws that protect homosexuals (and others) from being fired, say. In states like Indiana. In states that have such laws protecting sexual orientation as a class from discrimination, there are generally few claims against businesses for discrimination of services. There are two ways to interpret that
1) There are not many businesses which actually have any basis, much less a religious basis, in being interested in discriminating against their customers or employees on the basis of sexuality. It's actually a fairly expensive way to discriminate for one. Race or even class is generally very easy, religion or sexuality are less so and we should expect them to be less frequent. There are also very strong social signals for employers and businesses not to discriminate against people for sexual orientation. Even for people trying to claim some sort of religious determination suggesting they should.
It is perhaps surprising to some people that even in the presence of RFRA laws, there are not successful lawsuits defending the desire to discriminate, and there are not many such cases, given the rhetoric surrounding this debate.
2) What discrimination does exist is masked by people not stupid enough to claim that the basis for this is "I don't want to serve/employ homosexuals". That is, they find some other reason to claim they won't do so which is much more difficult to prove. They may even do so in an implicit bias way, rather than an explicit "fuck off" kind of manner we are accustomed to legislating. This is to say that there are not very many legal approaches we can take that will alter this variety of behavior. Such approaches would require a great deal of intrusiveness (monitoring a business' schedule to see if they are in fact not available at that time for example), and would otherwise be very expensive ways of reducing the likelihood of such activities.
What all of this comes down to, to me, is a different determination. Generally when the state gets involved, and there are legal remedies and approaches being constructed, I want there to be a very large externality (positive or negative) that is being resolved. This is so there is a certainty that government action is helpful and necessary. If there are widespread instances of restaurants refusing to employ or serve homosexuals in a general sense, this strikes me as a fairly large externality worth resolving as it potentially denies access and opportunity to an entire class of people to the market and there is no right being protected to generally oppress others in this way. Likewise the state should not be interceding in determining which private contracts between consenting adults are or are not marriage. At least in so far as it applies to sexual orientation this is a very small cost (some number of people might be offended), and a very large gain (some number of people's privately preferred associations can be fulfilled and recognized with the same rights and privileges as others when they do so).
Where this is less clear for me is more specialised economic services. A business which is generally open to the public must be fairly accommodating and non-discriminatory, at least so far as general classes of people are concerned (a grocery, a hospital, a hotel, or a restaurant). A business when or which makes fairly individualised services (an attorney, a doctor, a cake maker, etc) has more latitude to say when there will not be services offered. It is in effect, inherently a discriminatory service. A family doctor or an attorney does not have a legal obligation to treat everyone who walks in their doors. We might think it strange that a photographer doesn't serve gay weddings (but will do wedding photography generally), but they may also decide not to serve by doing baby portraits, say, or nude photography. This analogy is not perfect, but the point is that we already allow individual businesses a fairly wide latitude in how they will perform their services. It also means there is a market available for those that will perform those services. So there is a market for people to go do wedding photography, and do so where it involves gay or lesbian couples. In most cities, it would be strange to find that no photographer would do so I suspect. Or no cake baker. Or not one florist. None of these are themselves rights of consumers to expect that we may necessarily engage others to do for us. These are general promises made by businesses to make accommodations for us and vice versa. Most businesses will probably do so. Those that do not are at issue.
What that means removed from the market and the intersection with discrimination lawsuits is that the burden of proof that there is a discrimination proceeding is somewhat higher. Someone who foolishly evinces a (potentially bigoted) desire not to serve certain people, or to do so only for general services and not for others, lowers that bar such that it is easier to prove (as in the pizzeria example in Indiana, which explicitly said they will serve gay persons and couples, except under a hypothetical example of catering a wedding, something that I'm dubious has occurred even for many straight couples).
It also suggests something else however. What that does not necessarily mean is that the only right and proper remedy is that the business should be fined by the government or shuttered and any licenses revoked, and so on. Indeed, even if that is a remedy made available, it does not strike me as the necessary path of resolution. It is not clear, and has not been clear to me for the entirety of this debate, why someone would want to compel someone who has already demonstrated a desire not to work with "people like me" to perform a service that requires them to be creative and involved in the manufacture of food or decoration. I would not be confident in the quality of service I would receive and would think it strange to compel it. Particularly if there are alternatives available who would do so without compulsion. Provided there are alternatives, or alternatives could be manufactured to compete easily enough, it might be enough to identify such businesses that are less participatory and to compete economically through boycotts, or through the normal operation of markets to have less-discriminatory players benefit from those that are paying the cost of discrimination (less business opportunities, or fewer qualified employees, etc). There are limits to the amount of backlash to backlash I would sanction. In that I would not be prepared to say we should do anything to destroy or defame the property or harass the owners and operators or employees. But those owners can be made aware that there are problems with their decisions and that those decisions will have economic and social consequences. Perhaps some number of them will backtrack and decide their ideas about what their religion demands of them are incorrect. On this topic, given the rapid shifts in popular opinion, I would expect that there are many people still racing to catch up with what is and is not considered okay or what is or is not considered a demonstration of their faith as it applies to these questions. It is not clear to me that denying services to a wedding is required by any dogma and that mostly these are people who are in the "ew, gay people can get married" mode of thinking and wildly seeking any justification for that offense that they believe others will tolerate. Most people do not in fact tolerate religious pluralism on this question and there appears to be very limited legal backing for that position.
As to the more general atmosphere, and why these kinds of laws are emerging in the first place. I believe one of the reasons I've taken a more "meh" approach is that I recognize the laws themselves are, in most cases as there are exceptions, actually fairly powerless on these questions of discrimination law and what protections they would provide. But that does not mean that the laws are not representative of some legal or cultural attempt that deserves to be recognized for what it is and what is being attempted (haphazardly and fruitlessly as it is doing). In most cases, the recent attempts to enact RFRA statutes by state legislatures are transparently about the legal recognition being extended to homosexuals through marriage laws being overturned to provide legal equality. Since these legislatures, and a few cases the populations of states, are powerless to prevent this, this is a bizarre attempt to fight a rear guard action. It is itself toothless symbolism. I don't mind the existence of general protections of religious freedoms and favor such laws being passed. But under these circumstances, and with some of the exemptions that more extreme laws than Indiana's more general interpretation of the federal law, one cannot hope to notice that these attempts to demand pluralism are coming from the backing of people who have never demanded pluralism before and indeed, sought to suppress it for decades. Pluralism for me and not for thee is not how it works. To that extent, I think it is wise to oppose any new legislation be authored on this topic of religious liberty and to let things continue to play out in the economic, social, and cultural spheres as much as possible.
Some of the other arguments against such laws strike me as more standard progressive interpretations, which may also explain why I sort of shrugged is I'm more classical liberal than modern. Hobby Lobby for instance gave rise to a belief that "now for-profit companies can have religious beliefs". Which wasn't really what the case did. Aspects of the ruling applied to say this, but the RFRA application was to say the government can intercede to provide its interests if there is a minimal burden, the least restrictive one available, or the interest cannot be satisfied in some other way (which in the case of Hobby Lobby, was the case, the government had already provided an alternative that was less restrictive). This does not seem to me an overly offensive interpretation of reality anyway. Most everyone knows the religious stances of certain business owners (Chik-fil-A for instance), and this is in and of itself not objectionable that they should seek to conduct their business in a manner consistent with those beliefs. Some of those beliefs are objectionable. Which is a key distinction. Not every business which aligns itself with the religious beliefs of its core management and not every practice they undertake provides a direct manner of scrutiny in this way.
Similarly there was an argument that Indiana was different because it protected individuals in private lawsuits (as the New Mexico case was). But this is not actually that unusual either. The original interpretation and debate of RFRA included a lot of discussion surrounding private discrimination, rather than discrimination by the government in the form of "public discrimination". Private discrimination claims are typically introduced and taken up by states rather than pursued by those private individuals who are discriminated against. This is not that unusual of thinking or process. Such claims are typically involving many persons who would each have to mount a case separately for instance and the state's interest in preventing discrimination and being seen as preventing discrimination encourages it to take up large cases. The only reason this emerges is a circuit court split allowing for local or state courts to decide that this is not explicitly protected under RFRA laws (because it's not in the text usually). But a fairly standard understanding of how discrimination claims work would say that this is what is being discussed is private actors discriminating and being able to advance an affirmative defense against those claims.
There is a more compelling argument against this, to me anyway. That is that it allows religious claims to be advanced, but not necessarily taken at face value to override government interests like anti-discrimination, but does not necessarily allow non-religious claims. Say an atheist wants to discriminate for some reason, or perhaps more likely is accused of doing so. On the position of discrimination lawsuits, here I think it seems strange that a religious defense is rhetorically and ethically treated as morally superior to a secular defense and given some protection in law. In so far as religious adherents have specific practices, rituals, and requirements that are to be protected against government intrusion or permitted within reasonable accommodation by employers/businesses, and that was one of the primary intents of RFRA laws, that is perfectly understandable. Secular people tend not to have such rituals or requirements, so protecting such actions would be strange. In so far as religious adherents operate their business under the belief that it requires certain discriminatory actions, this is much less plausible as a defense. One that isn't typically being accepted anyway.
The difference of opinion for me is how to respond to that and whether to recognize it as a systemic problem in the market when it occurs or one that we can find a way around easily and resolve through the continuing and evolving standards on how society should treat one another fairly in our private transactions.