As I once mention (in my Hebrew blog, here) the fact that these are, at all, related is instructive. It means that the regnant ideal in religious circles (at least at the official level) is that cultural self-segregation is as essential an element of religiosity as performance of mitzvot. Anyone who knows (or reads) me knows that I summarily reject such a conclusion, and I will expand upon this point in the book I'm writing on Modern Orthodoxy in Hebrew.
At the present moment, I want to zero in on the other factor: One's Level of Religious Observance.
Let me preface my remarks by asserting the obvious. Mitzvot are not optional, and that reality should be the point of departure for any Orthodox Jew. However, contemporary Israeli Orthodoxy comprehends two, inter-related, basic fallacies in this regard. The first is based upon a fundamental misunderstanding concerning the difference between religious policy and law. The second is rooted in an extremely exaggerated definition as to the minimum of observance required for one to be considered legitimately Orthodox. These dual fallacies lead to the delegitimization of fine upstanding observant Jews; to the phenomenon of 'Dati-Lite' (and not infrequently) to the total abandonment of Observance and the so-called 'Datlash' (דתי לשעבר or Formerly Observant).
Religious Policy: There is very real difference between what the Torah might allow and that which might be legal, but undesirable. Ramban, in his famous discussion of the parameters of sanctity (ad Lev. 19, 2 s.v. קדושים) notes that one could, conceivably, live one's life within the boundaries of the Law, and still miss the point. He, himself, highlighted the need to carefully balance spiritual with material pursuits. Thus, while eating kosher food is a mitzvah, neglecting one's soul in the interest of gastronomic pleasure (qualitatively or quantitatively) would render one a 'Knave with the Torah's Permission' (נבל ברשות התורה). Contrarily, extreme self-denial would presumably also fall under that category. This corrective falls, according to Ramban, under the overall directive 'Thou shalt be Holy, for I the Lord your God am Holy' (קדושים תהיו כי קדוש אני ד'). This mitzvah is, in effect, an expression of religious policy, viz. the overall import of the Torah directs certain behavioral options over other (equally legal) ones.
This, of course, opens up a Pandora's box. Who's to tell what is the Torah's overall import, or needs? In a sense, it is around this question that the history of Orthodoxy turns (and has turned for over two centuries). In a Pre-Modern/Pre-Emancipation world, the integrity of Halakhah was complemented by an organic, living (ok, mimetic) tradition. With the latter's progressive dissolution, the setting of Religious Policy, based upon the 'best interests' of the Torah, became a judgment call by the Greats (and, more frequently, the would bees and wannabes).
It remains, however, a judgment call. If a person rejects such a judgment call, and his/her behavior is in consonance with acceptable halakhic norms (usually based upon a factor that might be deemed סוגיא דעלמא, or consensus. That, however, is a topic for another discussion); there is no justification to running them out of the Orthodox community, or of so abusing them that they feel they have no choice but to leave. I believe that this is the case in a number of contemporary contexts, where the proper policy is (I believe) to firmly voice our objections (respectfully), but adopt a 'Wait and See' attitude. In other words, if the mode of behavior (e.g. 'Partnership Minyanim') continue without sliding over the boundaries of normative law, then they will be regularized. If not, well, they will either disappear or read themselves out of the realm of Orthodoxy.
If one should not drive people out of Orthodoxy over more weighty subjects, one should certainly not do so over lesser issues. Nevertheless, religious priorities in the Religious Zionist world are so skewed that this is precisely what happens.