It’s still not relevant.

The charity is giving almost no money to kids. Thats the relevant part.

Doesn’t matter if it Catholic, Jewish, Scientologist, or Zoroastrian.

The law wasn’t faith based. The decision wasn’t faith based.

So why does the faith matter?

Both "giving almost no money to kids" and that the recipients (mostly adults) it did benefit were "based on religious affiliation" seem fairly surprising to me. If I donated a car, I would feel mislead by both.