Errol, living in London, the idea of any good school being anything other than oversubscribed is a pipe dream. Here the only schools that are under-subscribed are the ones that Ofsted has highlighted as requiring improvement. They are under-subscribed for that reason only, and many people would be offended by the idea that if the schools aren't good enough to fill up with churchgoers, non churchgoers can have the spare places. That's not equality.
Perhaps it's different elsewhere, where people are less mobile, and schools are under-subscribed because of declining population. However, I suspect that if the schools were considered good, it would draw people in, helping to sustain the population.