[If one worshiped idolatry] out of love or out of fear [of a person]... according to Abaye, who says that he is liable... according to Rava, who says he is exempt...
Tosafos (d.h. Rava) ask, since according to Rava a person who worships idolatry out of love or out of fear of a person is exempt, why did Mordechai not bow down to Haman?
Tosafos respond that it was either because Haman bore two idols on his chest, and in bowing down to him it would seem tha Mordechai was worshiping Haman’s idolaty. In their second explanation (as elaborated by Piskei Tosafos #278) they answer that since Haman expected to be worshiped in a public venue in the presence of many people, Mordechai concluded that it was important, under those circumstances, not to rely on Rava’s leniency, but to sanctify G-d’s name by refusing to bow, even though it would have been clear that he was merely bowing out of fear of Haman’s vengeance.1
Rava’s leniency, qualified by the clarification of Tosafos as to when it is proper to be stringent, is the basis of the ruling of Rama, Yoreh Deah 150:3 (based on Terumas HaDeshen):2
Nobles or priests that have forms of idolatry in their clothing, or who bear the form of the sun before them, as do the governors, it is forbidden to bow down to them or to remove one’s hat before them, except in a non-obvious manner, such as if his coins scattered or if rose before them prior to their arrival, and so too he should remove his hat and bow prior to their arrival. Others, however, are lenient in this matter, since it is known that even the non-Jews are not removing their hats or bowing down to the form of the sun, but rather to the noble. But it is best to be stringent, like the first approach.
Beur HaGra (ad loc. #5) however, notes that Terumas HaDeshen has not taken the beggining of Tosafos, which makes the case that even according to Rava, there is no license granted to serve out off love or fear, rather an exemption after the fact to exempt such a person from the death penalty.3
Notwithstanding the Vilna Gaon’s difficulty, later authorities have ruled that where additional extenuating circumstances exist - particularly where a situation like that of Mordechai’s in which he was either faced with bona fide idolatry, or accosted in a very public venue - one may participate in non-Jewish ceremonies. Thus, Mahari Aszad, Yoreh Deah #170 permits Jews to light candles on Easter night. He explains that the additional extenuating circumstances are many: It is not a religious law that Jews must particiipate in holiday illumination, but just the will of certain governors that the Jews in their jurisdiction rejoice as they do; their religion is not unmitigated idolatry; and, most importantly, the large number of candles may be construed not as a part of the Easter celebration, but as part of the [then] concurrent celebration of Pesach! (see Darchei Teshuvah, Yoreh Deah 150:14 at length).
It would seem, accordingly, that in our day a Jewish merchant would be permitted to hang “holiday” lighting and ornamentation during the “holiday season” - again, there is no religious law requiring such decoration. It is, rather, a commercial imperative; the “celebration” of the season is certainly not one of unmitigated religious spirit; and, most importantly, the decorations may be construed not as a part of the Xmas season celebration, but as part of the concurrent celebration of the season of Chanukah!
תוספות שבת דף ע"ב ע"ב ד"ה רבא: וא"ת ולמאי דפטר רבא אמאי לא השתחוה מרדכי להמן וי"ל כדאמרינן במדרש ששתי צורות היו על לבו ועוד משום קידוש השם כדאשכחן בירושלמי במסכת שביעית בפרק ד' כגון פפוס ולולינוס אחיו שנתנו להם מים בזכוכית צבועה ולא קבלו מהם:
שו"ע יורה דעה סימן ק"נ סעיף ג' בהג"ה: שרים או כהנים שיש להם צורת עבודת כוכבים בבגדיהם או שנושאים צורת חמה לפניהם כדרך הגמונים אסור להשתחות להם או להסיר הכובע לפניהם רק בדרך שאינו נראה כמו שנתפזרו מעותיו או שיקום לפניהם קודם בואם וכן יסיר הכובע וישתחוה קודם בואם (ת"ה סימן קצ"ו) ויש מקילין בדבר הואיל וידוע שגם העובדי כוכבים אינם מסירים הכובע או משתחוים לצורת החמה רק להשר (שם בשם ר"י מאפנו"ס ומהרי"ו) וטוב להחמיר כסברא הראשונה:
תוספות שם: וי"ל דסבר רבא דאפילו למ"ד דחייב למסור את עצמו אם לא מסר עצמו לא מיחייב מיתה בבית דין: