The past is a foreign country; they do things differently there.
Rangers originally signed Roman Catholic players but appear to have stopped at some stage during the First World War. No-one has ever definitely established why or who was primarily responsible. Although the recruitment of footballers like Laurie Blyth and Don Kichenbrand has been cited as 'proof' the club didn't have a restrictive signing policy, it is far more likely these players were signed in the belief they were Protestants.
The board and support clearly viewed Rangers as representing the Scottish Protestant community and they would have argued that signing only Protestants was simply a logical extension of that position. In those days football clubs were certainly not perceived as 'equal opportunity employers' like the local supermarket.
In truth, no-one bothered too much until the mid-60s. We are talking about times when an Orange parade in the East End of Glasgow took priority over a Celtic-Rangers match and when the Parkhead club had been requested to stop flying the Irish tricolour from the main stand. The Republic of Ireland was not seen in anything like the terms it is today but rather as a hostile entity that had connived with Nazi Germany (it had to wait until the mid-50s before the USSR agreed to its membership of the UN).
Some injudicious words from Ralph Brand in an interview following his departure from Rangers marked the point when the 'signing policy' became a talking-point in the press. Jock Stein alluded to it, presumably in an attempt to seize the high-ground.
By the 70s much of the media saw a correlation between the 'signing policy' and the hooliganism that was increasingly troubling the club, although there wasn't really any evidence to support this point. By the 80s it was being seriously claimed that Rangers signing Catholics would end 'sectarianism' in Scotland. There is no doubt, though, that the club was coming under pressure and would have had to adapt in light of the increasing difficulty in fielding a top-class side comprising only Scots. Most Rangers fans I spoke to back then accepted the club had to change if we were to progress - by that stage negative campaigning could have a serious impact on advertising/sponsorship/etc.
Ultimately, those who castigate Rangers most vociferously have to accept that a club is defined by its board and its support. Players are only transient figures. Surveys carried out of the supports of Rangers and Celtic show that they are almost entirely Protestant or Catholic (or describe themselves thus).
The Mo Jo signing didn't really change anything in terms of the bigger picture. It is now only being referenced as a stick to beat Rangers with.