First, what does "literal" mean, anyway? One definition is "following the words of the original very closely and exactly." From this beginning, one could take the ICR's or FRC's path and selectively ignore or inflate evidence that that contradicts or supports, respectively, one's ideological interpretation and political goals. Alternately, once could start from this point and delve more deeply into the original words of the text as written in their original languages, seek to understand a fuller context of meaning at the time they were written, and investigate how words and meanings changed over time and in different places.
Using the former approach, one would start with a predetermined conclusion and constrain the context of words and concepts to support both the conclusion and original premise and, thereby, make it seem as if there is no other possible way to understand the text. Applying the latter approach, one makes use of all available sources of evidence (historical, archaeological, linguistic, etc.) to compare-and-contrast different versions of a text, examines changes over time and the causes of these changes, and produces interpretations that reflect as accurately as possible the inherent uncertainty, probability, and complexity.
One group that is taking the latter approach is the Jesus Seminar & Westar Institute. From their website:
Until a few years ago, essential knowledge about biblical and religious traditions was hidden in the windowless studies of universities and seminaries—away from the general public. Such research was considered too controversial or too complicated for lay persons to understand. Many scholars, fearing open conflict or even reprisal, talked only to one another. The churches often decided what information their constituents were "ready" to hear.
Through publications, educational programs, and research projects like the Jesus Seminar, Westar has opened up a new kind of conversation about religion. This is an honest, no-hold-barred exchange involving thousands of scholars, clergy and other individuals who have critical questions about the past, present and future of religion.
Some of the principles guiding the work of Westar are:
* All serious questions about religion—including biblical and dogmatic traditions—deserve research, discussion and resolution; no inquiry should be out of bounds.
* The scholarship of religion should be collaborative in order to expand the base of decisionmaking, cumulative in forming and building on a consensus, and genuinely ecumenical
* Religion and bible scholars should conduct their deliberations in public and report the results to a broad, literate audience in simple, non-technical language
Even though I'm not a Christian (or even a monotheist), a great many of my fellow American citizens are. When so many Christian groups seem to be working so hard to undermine intellectual inquiry, democratic freedoms, and civil society more generally, it's nice to get these occasional reminders that theirs is not the only interpretation of the religion out there.
 Nancy Haught, "Willamette-based Jesus Seminar, no stranger to controversy, plans book on apostle Paul," Oregonian May 14, 2010.