I'm kind of shocked that the Pastor did this. I currently attend a Baptist church, where some raise our arms in worship; most don't. No one would ever ask someone to stop. Way to turn your DIL off to going to church.

Our previous church of many, many years was the theater/storefront non-denominational type you've described. We all worshipped very expressively. It's not ritualized or limp, though.
I loved it there.