The reasoning of worrying about a Bible study becoming a church could also apply to homeschoolers.
What if some homeschoolers got together in someone's home for a craft day every couple weeks? Would someone be pitching a fit about it maybe morphing into a school? It would make as much sense as worrying about a Bible study morphing into a church.
If the city feels that it can regulate Bible studies like that for whatever reason, there's nothing stopping them from regulating homeschools either because they aren't zoned as schools.
I think you are on the right track. As Christians we are focusing on the religious nature of the gathering. We are living in an age where the nanny state thinks they have the right to control everything.
In this case it was some govt type who saw a sign and decided it was his business. I think there is a high probability religious discrimination played a role. However, why in the world does some local govt even think they have right to determine who can and can't gather in a citizen's home.
Private property rights are tenuous at best with the nanny state.
I remember a similar story years ago. In that story, neighbors had called to complain about all the cars parking in their neighborhood. The police issued a warning to that family to stop having prayer meetings, too, which led to an uproar.
However, would the police order a family to stop having family get-togethers at their home, or to stop inviting friends to have a party? Probably not.
Why do we tolerate this? The 9th Amendment is there for a reason:
To tell every level of government from Federal to Local that the people retain all their rights in America under our Constitution.
That we have to wiggle around the 14th is silliness.
Government is limited the people are not.
That’s the fight we are in and will be forever.