LOL... I'm not buying it. The HOA made no attempt to invoke the 'No Signs' clause until after a resident complained that the display was offensive. If you're going to give such a clause that broad a definition, address placards, names on mail boxes, etc. are also in violation. Such clauses are usually meant to keep Realtor 'For Sale' signs and such from cluttering lawns and giving the impression people are moving out. Trying to use it to bulldoze a Christmas display is quite the stretch, IMHO.
BTW, you may not be aware, but most HOA rules are not enforceable in our state. There is a law on the books here that essentially voids any neighborhood covenant that impedes someone's basic rights. WJZ's Dick Gelman once used it to win a case against a Columbia HOA. I'd be willing to bet there's something similar on the books in PA.