Would a church be banned from operating in the same area? No? Then neither should be the mosque.
There's at least one church there that's getting the runaround, yes. My own local Lutheran church in IN had some issues expanding a few years ago. This is normal and common and expected when it comes to land development. Makes no difference whether the development is owned by religious folks vs seculars.
Being in the press makes no difference either, for that matter. Try putting up a broadcast tower in your backyard. When you run in to trouble, loudly proclaim your free press rights are being violated. See how far it gets you.
This ain't about the 1st amendment. No how, no way. Appeals to the 1A completely miss the point.
The fundamental issue is whether the development is suitable for the location. If a given church is unsuitable, then I'd fully expect it to be blocked/moved/altered/whatever. Same for a mosque. Or a newspaper publisher. Or a farm, nightclub, skyscraper, anything.
Being Muslim doesn't give you special dispensation to build in grossly inappropriate locations.