The Freedom from Religion Foundation is correct in their interpretation of the constitution as it relates to school-sponsored prayer or other school-sponsored religious activity. As to non-governmental groups that are not school-affiliated, but that might sometimes use the school's athletic facilities, there is no constitutional reason that such group can not have prayers or other religious exercises on the school's property, so long as those activities are strictly directed and controlled by the private interests, and not the school (an arm of government). It is not clear from the article whether the Freedom from Religion Foundation's complaint would extend to such private activities on school grounds.
A public school can make its property available to all kinds of groups, religious and otherwise. It is not uncommon for churches to lease space in public school facilities to conduct church services. Of course, the school system must not discriminate in favor of one religious group or another, which would imply an endorsement. I know of no controversy that has emerged from such a practice.
For a long time, in the "Bible Belt" and elsewhere, public, school-endorsed prayers have been commonplace and have generally gotten a "free ride," so to speak, since the practice is very widespread and since there is rarely anyone who is motivated to object to the practice on constitutional grounds. Lauderdale County officials would be wise to cease the practice rather than to bear the legal costs of vainly attempting to defend it. The downside of such a decision would be to invite ignorant criticism from the under-educated, hard-nosed right wing die-hards who will continue to lament that, "The Supreme Court has taken God out of our schools" and who will condemn the responsible officials for not "standing up for Jesus."