I can’t believe no one’s brought this up yet:
I love it. It’s a creative theological solution to a prctical problem. I don’t find it in any way demeaning or disrespectful, but then, I’m of a leient nature.
As the above links show, this has provided lots of fodder for twitter.
Although, I have to admit, what I first thought of when I saw this was the Weapons Scene from From Dusk 'til Dawn:
I thought it fantastic =)
I, too, thought that was a creative and practical solution. And the picture is really funny. Not demeaning, not disrespectful… but amusing.
I’m glad he is still caring for his flock. And I bet they are, too.
Unlike far too many “spiritual leaders” he doesn’t seem to take himself too seriously or is too hidebound by traditions.
I approve. That, and five bucks, will get you a coffee at Starbucks.
My first thought was the legend of
Feng Yu-Xiang
There is also this (shades of Father Ted):
Cute, creative and kinda sad at the same time. Why people need this type of affirmation is still baffling to me.
It would make a great Monte Python sketch though. 
I’ll be honest; I was not aware that it’s customary to have one’s priest bless one’s Easter basket. But if that’s what people wanted, he found a safe way to do so (assuming the water is clean).
I had assumed he was blessing the people, not their baskets.
The quote in the OP says, “he’d bless their Easter baskets with a water gun from the safe distance of a curb.”
The article is a little confusing. It does say that, but is also says “Priest Goes Viral After Using Squirt Gun Full Of Holy Water To Bless Churchgoers” and “A Roman Catholic priest from Michigan has blessed the internet with some hilarious memes after photos of him using a squirt gun to spray parishioners with holy water went viral.” My guess is he sprayed whatever the parishioners wanted him to spray.
I’d use balloons.