"But if you have no real choice about "agreeing" - they are rules."

It's clear that everyone has a real choice in the matter. Either to attend the private school and agree to its principles, or not to attend. If I recall correctly the BC Court of Appeal affirmed that point. No one's forced to attend TWU, and there are many options available for those don't want to.

With respect to the 2001 SCC decision, it's not up to the SCC nor anyone else to decide what a student feels is a fair personal cost. A non-heterosexual student who, for reasons of her own, chooses not to be sexually active isn't inconvenienced by the covenant in the slightest. Hence, the matter is properly left up to the individual. You either agree to the covenant or you don't, and if you don't you go elsewhere.