The liturgical/worship music conundrum is alive and well in nearly every church I've been part of (life-long Methodist here). Larger churches can have two different services, but smaller churches often have to make a choice, as you describe. Most churches go with contemporary music in the hope of attracting a younger crowd on the theory that "If you build it, they will come." But I think that's probably the wrong choice: play for the congregation you have rather than the one you want. I know that flies in the face of lots of other life advice, but it seems appropriate.

Enjoy the donuts and (hopefully) the potlucks!