Saving Souls Vs Not Offending God
The sincerity argument is powerful, because it's able to concede both that there is One True Faith, and that we can trust that the religion imposed by the state is the OTF, and yet still conclude that separation of church and state is correct. (Contrast this with the skeptical argument, which is based on a measure of doubt about the existence or identification of the OTF, or the political argument, which is based on a lack of trust that the state will pick the OTF to impose.) However, the sincerity argument relies on two important, and questionable, assumptions about the nature of the religion that the hearer believes is the OTF. Commonly noted is the fact that not all religions believe that only sincere faith counts or that coercion is unable to produce sincere faith. Less noted is the sincerity argument's assumption that the point of government imposition of religion is to save citizens' souls.
The soul-saving assumption flies easily under our radar because we tend to believe, in the modern era, that the only justification for (domestic) policy is the benefit of the citizens, protecting them against each other and (more controversially) against themselves. The corresponding point of religion is to secure the wellbeing of individual believers and potential believers. Thus religion policy should be judged, from the point of view of a believer, by how well it saves souls. However, the eternal fate of the believer is not the only possible goal of religion.
An alternate view is that the government should impose religion in order to avoid offending God. Imposition of religion is thus for God's benefit, not for the imposed-upon person's. It is far more plausible that forced, insincere religious observance is adequate, or at least useful, for avoiding offense to God, than that such observance is useful for saving souls. Sincere belief may still be the highest good, but God would rather have a chaste and church-attending atheist than one who indulges in sodomy on Sunday mornings (assuming that conservative Christians are right about which particular behaviors offend God). Saving souls is consistent with the modern-liberal idea of human society as an arrangement among members of Homo economicus (a Market Pricing view of religion, to use Alan Fiske's terminology). Not offending God draws on a model of society as looking up to an external authority (what Fiske would call Authority Ranking).
The believer in an offendable god would see offense-avoidance as having two rationales. On the one hand, there is a basic moral imperative -- it is simply wrong to do, or allow, things that offend God. The exact nature of the imperative can be conceptualized several ways -- it may be that God's "thou shalt not" intrinsically creates a moral obligation, or it may be that showing the love and respect that is due to God entails not offending him. On the other hand, God is unlikely to let moral offenses slide, so there is a practical rationale -- don't offend God, or he'll punish you. Hence the claims that 9/11 or Katrina were divine retribution for those cities' acceptance of homosexuality. If we grant that explanation for the sake of argument, it becomes plausible that enforced closeting of unrepentant gays could have avoided God's wrath.
Thus, insofar as a religious person accepts "don't offend God" as a legitimate goal, the sincerity argument for the separation of church and state is likely to fail to persuade him. Note on the other hand that the sincerity argument remains valid for the special case of imposing nonreligion, since getting someone to be an atheist can only be for his or her own good, as there is by definition no higher power to be potentially offended by outward religious behavior.