But the city is correct to ask the Lutheran school to repaint the plow they've submitted. If the blade were going on a private snow-plow operator's truck, even if that private snow-plow operator were sub-contracted by the city to plow certain streets or lots, it would be fine. But it will be mounted on a city-owned vehicle. As such, an explicit endorsement of Jesus Christ (or any other religious figure, such as Muhammed or Buddha) is not permitted by current case law. The city must remain, and be perceived to remain, neutral. The first amendment does not protect the Lutheran school in this case - they are not being denied a right to speak. They are simply being denied the privilege of having their views proclaimed by city property.
One may or may not regret this status, but the line drawn by the US Supreme Court in matters like this is quite clear.
The school should look to a different way to present their message, perhaps more subtly. A prairie scene that includes a church, for instance. It's historical, simply a picture of an early Sioux Falls area scene. It doesn't constitute an endorsement, but does point out the importance of Christianity in the White settlements. Perhaps simply a picture of Luther superimposed on a Norwegian flag - which flag features a cross rather prominently - would do.
As the Gospels tell us, be wise as serpents, innocent as doves (Matthew 10:16).