Well, i would disagree with much of Larry Moran's language, although he isn't and i don't see him as representative of any institution or academic system. However, the word "flunk", as i understand it, means to fail in a course or examination. If a student studies biology and submits work or exam papers with creationist material, if a graduate hands in thesis with creationist material, would he or she flunk the course? Yes, in my opinion, not because the material is unacceptable, but because it is plain wrong and unscientific. This isn't a matter of academic freedom, but a matter of competence. I have failed many courses and exams in the past and i wasn't about to dispute the matter by citing academic freedom.
That said, i do accept that fundamentalist Christians can be defined by what they believe as well as what they do. It is unacceptable and illegal to discriminate on the basis personal beliefs. I would even say that remedial classes could be offered to educate those who are not educated in evolution as prerequisite to studying biology, but need not require them to believe in evolution. After all, one doesn't have to believe in anything one does or says! Knowledge is a prerequisite, but belief isn't.
In other words, it would be possible (though bizarre) for a student who believes in creationism to graduate with a degree in evolutionary biology, but he or she would not do so through creationist work!