It's government endorsement of religion that is forbidden by the Constitution. The fact that Christmas is a federal holiday is irrelevant.
It's not an endorsement of the Christian faith. I think that's an inaccurate representation because if it were, we've been violating the Constitution since George Washington said "So help me God" at his inauguration.
It is merely a civilization's celebration of its dominant faith and in this pluralistic society that adheres to Judeo-Christian values, a Christmas wreath at the White House, saying Merry Christmas, and Christmas trees on federal property do not represent a endorsement of Christianity as much as a recognition of the fact that our civilization has been Christian and celebrates one if its major holidays accordingly.
What I'm saying in short, it's not endorsement. The Government does not say "You must be Christian. We are a Christian government." To say explicitly an endorsement, it would have to be a resolution saying we are a Christian Government and we are bound by the laws of Jesus. Nothing of the sort is going on here.
The Government is simply saying "We recognize that many people are Christian and it is a custom to have Christmas trees at Christmas and to say Merry Christmas," etc.