I saw REM probably two dozen times in college, I also went to some parties with them. They were far better playing in small venues and colleges. It was not a huge secret that Stipe was gay, it just wasn't advertised. I saw them one time when they had 10,000 Maniacs open up for them, nobody had ever heard of them they got booed off stage; Natalie Merchant was close friends with Peter Buck and Bill Berry, so REM came out played exactly ONE song, Stipe said "F*ck You!" and they walked off stage.
I asked pissant this question earlier, but have you heard of Guadalcanal Diary? They were from the same city in GA that REM was from.