There is a big difference between confessional scholarship and its working assumptions and historical-critical scholarship and its working assumptions, and we must never confuse the two. Confessional scholarship is willing to compromise and apologize in order to keep 'history' aligned with the faith tradition. It is willing to understand theology as history and write about knowledge in these terms. Historical-critical scholarship is built on the presuppositions of the scientific search for knowledge. It is unwilling to allow theology to be history.
If you are at all uncertain about this distinction, it is easiest to see it when you look at a religion that is not your own and the claims to truth that religion makes. Think about claims that are made about Mohammad, Buddha, or any religion that has "historical" founders or scriptures. Its views on their founders are theology historicized. They are religious truth claims that have been accepted as fact by believers from that tradition, and scholars who work in that tradition. Those outside that tradition recognize this easily.
The easiest example of this in Christianity (which I have also discussed on numerous occasions previously) is the physical resurrection of Jesus. Confessional scholars are willing (some even feel compelled) to allow for the physical resurrection of Jesus to be historical fact. Of course it is not. Dead bodies don't come back to life. And Jesus' body did not come back to life. This is a theological doctrine that was historicized in the literature of the early believers. Those outside of Christianity, and non-confessional academics in another field (like science) see this immediately.
The virgin birth story is another example. Confessional scholars are willing to allow for Jesus' birth from a virgin. This is theology that they have confused with history. Of course Jesus had a human father -whether it was Joseph or someone else. Children aren't born without an egg fertilized by a sperm. If you really want to get silly about this, in the case of Jesus, since he was male, he had to get his Y chromosome from somewhere. Since dads are the only transmitters of the Y chromosome, he had to have a dad. And it wasn't the holy spirit. Even the Valentinians laughed at that logic since everyone knew the holy spirit was Jesus' mom. She was a female!
Humor aside, this is a very serious issue for our field, and now that post-modernism is gripping the academy, we see the abuse of philosophy in order to bolster the positions of confessional scholars who want to continue to make the argument that their theology (and their scripture) is history. They confuse the idea that since all positions are subjective, the scientific position has no better claim to truth than their own.
Of course there is a difference, and in the case of the scientific approach is does a more accurate job recovering history than a theological approach because these approaches have different sets of assumptions they begin with. The scientific approach does not allow you to mistake theology for history, nor does it allow you to mistake the doctrines that developed in the religious tradition to be the history that the tradition says they are. The scientific approach knows that this is the way that the religion justifies its doctrines; it is no history. But confessional scholars are willing to excuse its religious doctrine for history and even bolster this justification by (mis)using philosophy, literary criticism and the social sciences to try and argue that there is nothing we can know for certain because there is no objective truth, so their truth is as historical as any other.
I can't write more today because I am home with a sick five year old (as I was yesterday). But I hope in the next few days to continue my train of thought, because I think this is the MOST IMPORTANT discussion of my generation - whether we are willing or not to abandon our field to confessional claims to knowledge and truth in the post-modern age.