Last week in Nurre v. Whitehead, 2007 U.S. Dist. LEXIS 70049 (WD WA, Sept. 20, 2007), a Washington federal district court rejected a complaint by a student member of a high school wind ensemble that his constitutional rights were violated when school officials rejected the Ensemble's decision to play Franz Biebl's instrumental arrangement of "Ave Maria" at the 2006 Jackson High School graduation ceremony in Everett, Washington. Officials decided that all religious music should be kept out of graduation. The court rejected plaintiff's First Amendment speech claim, as well as her Establishment Clause and Equal Protection claims. The court held that the Ensemble's performance of "Ave Maria" at graduation would have borne the imprimatur of the school, and the state therefore had an interest in preventing possible Establishment Clause problems that would arise if the musical piece had been permitted.
UPDATE: Here is the full opinion in a non-proprietary database, thanks to Alliance Alert. And here is a recording of Biebl's version of the hymn via YouTube.