I also believe in a person's choice to do with their lives as they want, as long as it doesn't hurt someone else. I am also a Catholic and believe that the Bible is the inspired word of God. That being said, it was still written and edited by humans who in themselves are fallible, so I tend to read it in a more scholarly way than just the face value of the KJV. I am more like Falconer in that I look at who (or which group) a particular verse or book was written by, who it was written for, what the historical context of the script was, etc. The earlier books of the Bible (Leviticus and Deuteronomy) were written by the Jewish leaders stating their laws and stories from an even older oral tradition. Looking at it from that light, some of the laws make sense in that context but are foreign in today's world. For example, the Jewish food laws (which are another section of the Bible that fundamentalists conveniently ignore) probably have to do with helping this early society prevent many of the food-borne allergens and diseases that would have been prevalent before today's sanitation and storage technologies. If those food laws were written today, we may also include some "contamination" protocols, but for different reasons; people with Crohn's Disease or other gluten sensitivity can testify how important it is to use different utensils, dishes, etc. when preparing gluten-free foods.
Likewise, there are probably some very valid reasons for the early laws regarding sexual morals. Promiscuity, prostitution, and adultery (and later polygamy) were prohibited to cut down on pregnancies outside of marriage (or in the case of polygamy, over-breeding in marriages); something of greater import back then when society was ill-prepared to help / handle the extra economic burden that that would entail. Inter-species mating would be banned because of birth defects that would cause if the pregnancy even took. Also, by making any form of sex outside of the purpose of procreation as wrong (eg promiscuity, prostitution, fornication, and even homosexuality albeit to a lesser extent being more dependent on the promiscuity of the relationship rather than the type of sex performed) would lessen the spread of sexual diseases. Some of the societal ills that these laws helped prevent back then could be valid in today's world were these laws enforced, although today's world can better handle these problems when they occur, and at least in America, we tend to value personal freedom and individual responsibility more than the imposition of these laws.