Why can people be so openly racist toward Muslims?

Obama has time and again stated that he is, in fact, a pious Christian -- denying all "allegations" of Muslim affiliation. My question is: why are people so afraid of having a Muslim leader? I could've sworn that we currently possess the freedom of religion. I, for one, wish he was Muslim so that people would get the hell over it. Its okay to be bigoted if someone is of a different religious persuasion? It all just confuses me immensely. I know it was just a slip, but when confronted with this rumor by a supporter, McCain responded by saying that he wasn't a Muslim but rather a "good family man." It just exemplifies the attitude of many toward this whole situation, not McCain specifically.