Two articles:

Critics Blast Palin's Bible-Based Legal Plan:

Doesn't Sound Quite Like America...  Mediaite's Frances Martel drolly summarizes Palin's comments: "Creating law based on a specific religion doesn't sound at all like separation of church and state, but Palin countered that with a message to Americans that do not share her religious background: 'Yay, welcome to America!' " 

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'Thank You, Sarah Palin' caustically begins The Moderate Voice editor Joe Gandelman, who unleashes a geyser of anger at Palin.

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'Founding Documents' Contradict Her  At Below The Beltway, a more even-toned Doug Mataconis meticulously refutes Palin's argument by quoting historical documents from America's early days.

PALIN WANTS BIBLE AS BASIS FOR US LAW:

Dr. Ed Buckner, President of American Atheists said that Palin's remarks displayed a breathtaking lack of knowledge about the evolution of law and American history. "If we didn't know better, we might conclude that Sarah Palin's 'education' was somehow carried out in Texas using textbooks that the Texas Board of Education is now trying to fabricate."

"Our Constitution and Bill of Rights are not based on the Bible; and the Founders, some of whom were religious, nevertheless advocated separation between government and religion. In fact, Thomas Jefferson wrote in an official letter as President of the need for a 'wall of separation' between church and state. Jefferson also wrote explicitly about the falsehood that our laws are based on the Ten Commandments."