I think the biggest takeaway from the show, and the biggest thing people need to wrap their heads around to continue watching the show is this: The title does not just apply to the two girls who are faking being lesbians.
In this super-inflated, almost caricaturistic portrayal of a liberal high school where "the outcasts are the in crowd", pretty much everyone exudes that ultra-tolerant veneer. And yes, I say veneer, because there's a lot more unseemly things underneath most of the main characters: Most of them are using the facade of tolerance for their own purposes. Sometimes that tolerance is truly genuine, but it's still only there for a character's own, shallow ends.
Take Liam, for example. On the outside, he's an environmentally-conscious, tolerant, dreamy starving artist. But the hints from the first episode are that this facade is almost only used to get women. It's mentioned that he could get any girl in school, and indeed, has already had most of them. His veneer makes Karma crush after him like she does Ryan Seacrest (hey, Idol allusion!), but his actual thought process is wanting to "turn the lesbian straight", which is probably the single biggest bone of contention among the LGBT crowd.
Karma herself is willing to fake this because she's incredibly obsessed with popularity, to the point of already thinking up bizarre schemes to try and fit in by standing out. Like pretending to be blind (which unravels after she catches an errant frisbee). She attempts to be a social chameleon (Pun #1), and usually drags her friend Amy along with her (So in that way, she's kind of a bitch--pun #2). When the prospect of popularity from being a lesbian is dangled in front of her, she drops pretty much everything to chase it, not caring who she hurts in the process...at least until she realizes what she's putting her friend through. And even then, her rooftop apology is almost a veneer in itself, to get Amy to agree to play along for her friend.
Then there's Shane. Who (and gay peeps aren't going to like this either) might just turn out to be the biggest bully in Hester High. He also is using Amy and Karma's lesbian antics for his own ends: He wants his lesbian friends, and he'll stop at nothing to get them. Like by outing two lesbians against their will, even as one of them adamantly denies that she is, not five minutes after he said he "won't blab--gay scout's honor". If a straight guy had done that, the LGBT community would have exploded. And this is not at all mitigated by the fact that Shane does indeed think that Amy and Karma are lesbians (and at least has Amy partly right); even if they were lesbians, forcing them out of the closet against their will would make you a giant dick pretty much anywhere else, even if it did make them popular enough to be Homecoming Queens. But, of course, he saves his biggest bullying tendencies for the one student who would be in his shoes at any other high school: Lauren. Many people might say "She brings it on herself with her bigotry", but think about that: Would that be an okay rationalization if the situations were reversed? Basically, bigotry at Hester is treated as being gay would at a conservative high school. The only real difference is that Lauren has the Alpha mentality and thus can trade barbs with Shane throughout the show...even when he heckles her during her homecoming speech.
As for Lauren herself, she doesn't even pretend to have any veneer of tolerance, being as she's used to being the queen bee in a "normal" school. Her bigotries are right on her sleeve. But even at the very end, she has a bit of a veneer to her, willing to say the "right thing" to get what she wants (the homecoming crowd): Her mike-jacking rant at the end is, basically, airing the complaints of the entire actual LBGT community. In fact, she actually says "They're mocking the gay community!" But, of course, she's not doing it for tolerance, or altruism. She's doing it for the crown. And in that, you can at least respect her, even as you hate her gay-bashing guts.
Perhaps the only student at Hester High who isn't using a veneer for her own ends (except for maybe the adults, of which we've only seen a handful) is Amy. And that's likely because she doesn't know herself well enough to have that veneer yet. She has no real ego, which means that she really doesn't care what most people think of her. But at the same time, she also doesn't have the will to stand up to her friend in a meaningful way when she hatches another hairball scheme to be popular. Sure, she does rant at Karma several times throughout the episode how she doesn't want to do the fake lesbian thing, but each time Karma is able to convince her to keep the charade going. And at the end we see why she's easily convinced, as she might just see Karma as more than a "friend"...
None of this is to say that this is either bad writing or bad acting. In fact, it might be a brilliant setup to look into the seedy underbelly of a school which celebrates diversity to the point where "normal" is the new "outcast", and how people exploit it for their own ends. I guess we'll just have to wait how the season plays out...but I think everyone's Faking It.