The danger of watering down the Gospel, is it can lead people into 'shallow christianity' which makes them easy prey for cults claiming to be Christian. I know, I was there (if you would like my story of how I came out of a so-called Christian cult, Freepmail me). It's not about what I say, it's about what God says.
I would argue that it's not the fault of a Christian rock band if that happens. They are doing what God is calling them to do. I know jazz musicians - instrumental jazz musicians - who spend a lot of time on their ministry. There are NO lyrics in their music, but they are doing what God called them to do, and using their craft to glorify Him. How could anyone be critical of that?