Misleading title. What they banned was having employees of the school lead Bible studies. Dorm Resident Managers and Assistants are employees of the school.
Anyone else living in the dorm can have as many Bible studies as they wish.
There is no separation of church and state in the constitution. The constitution forbids the Federal Government from establishing a State Religion (such as the Church of England), and not prohibit public employees from practicing their religion.
But then you know that don't you.