There is an excellent article by Sharon Wright for the Guardian on her experiences as a governor of a church school here: http://www.guardian.co.uk/education/2010/sep/20/faith-schools-governor 
It is particularly pertinent, because it highlights several things that many in the churches refuse to accept are going on.
Sharon explains how, as a church-goer, she was a school governor at her local church school. She relates how the school, like many church schools, actually originally had an open admissions policy. That changed however, as the school became more popular, to prioritise church children over everyone else. This, as is often the case, was done in the name of ‘preserving the Christian ethos of the school.’ But of course, as Sharon’s example shows, many church schools around the country maintain their ‘ethos’ happily without discriminating in this way - which makes a nonsense of the idea that they have to exclude others to in some way be ‘Christian’.
What is also fascinating is that when she tried to mount a Christian argument - that giving priority to Christian children might not actually be a particularly Christian thing to do - the idea simply didn’t register. It was as if the governors didn’t feel that the teachings of Jesus had much at all to do with maintaining a Christian ethos.
Faith schools, with their current practices, are hurting the churches by undermining the very Christian message that they seeks to uphold.
They are also turning many people away from the church, and indeed church schools, as Sharon also points out. As one episode of the BBC’s hilarious ‘Rev’ recently highlighted, one of the main attractions for churches in having admissions policies which discriminate in favour of church kids, is to (temporarily) boost the number of bums on pews. But this also works both ways. Many may attend church (and then leave when their kids have finished there or even got into the school) but many will also be put off from ever going there again. What, after all, does the church offer that is attractive and distinctive in terms of values, if it behaves just like other self-interested groups?
It was interesting too to read about Sharon’s experiences of the treatment of children with Special Educational Needs by her church school too. Again, this is an area where the church is in denial (as I have found from personal experience). One only has to talk to a group like Parents for Inclusion , the Alliance for Inclusive Education  or the Centre for Studies on Inclusive Education  to hear horror story after horror story of how children with SEN are treated by church schools.
Church schools could be, and should be, the most inclusive schools around. But if they don’t practice effective and comprehensive religious inclusion, why would we expect them to practice inclusion in other areas too? They may claim to be inclusive. The reality is that they often fall very short. The problem is that many school governing bodies just don't see their failings in this area. They only see the handful of children with SEN that they do take (which they consider to be something special, rather than the norm for all schools). They ignore completely the many who have never made it to the school in the first place because the school was not geared up to take them, or those who have been considered 'ill-suited' to their particular school and so gently moved out to somewhere 'more appropriate' to their needs.
Which is a huge shame. Because if you read the Christian Values for Schools website  the values that church schools profess to uphold are very different. Church schools could be, and should be, examples of inclusive education at its best. And this is where I disagree with Sharon. I am not opposed to church schools. Many church schools have wonderful teachers and wonderful governing bodies. And church schools do what they do, not because they are nasty. They do so because they are fearful, and don't have the courage of their convictions. I am just opposed to the un-Christian elements. The church is its own worst enemy when it seeks to defend practices which clearly contradict its own faith.
What we need is a dialogue to explore how church schools can be bolder, more pioneering and more radical in demonstrating their Christianity. And what I mean by that is not more religiosity. (Indeed, to be more inclusively Christian, much religiosity will need to go). But rather such things as admission policies which prioritise the most vulnerable, fully inclusive environments which put vulnerable children at the heart of schools and allow schools to be shaped by them for everyone's benefit, truly restorative discipline policies which move away from punishment-based approaches, and an end to competitive and results-based ethos. Such things would be in line with the faith the church professes.
At present however, many in the church hierachies who have responsibility for schools, are far from willing to dialogue. Fearful of change, they charicature those who highlight shortcomings or urge reform of their schools, as part of the 'aggressive secularism' to which the Pope recently referred. It is more convenient to do so, than acknowledge the substance of what is actually being said, which might expose the need for change. And so this is why it is so important that Sharon's story, and those of many others like her, continue to be told.