I thought this was another surprisingly good episode. At the very title was expecting a sappy X-mas episode, I rather enjoyed it, especially Rosenbaum's performance. Dunno how good of an actor he was before the series started, but he's definitely learned a few things from working with John Glover.
Yeah, Lex's whole "what is happiness" speech seemed a bit overdrawn, but it fit for the future corporate/criminal mastermind we know and love. I think as far as Lex's whole "God" speech, it was a combo of his anger over his father once again manipulating his life as well as telling his mother what to do with the proferred redemption. Although I'm not to sure I'd take such a "redemption" if it meant the woman I loved died while I watched helplessly.
As for the dream sequences, it felt like Lex's confusion (again well-played by Rosenbaum) was just to easily accepted as status quo, such as the child seat and the story about the Christmas tree. I did appreciate the cheese anvil about Clark getting promoted to full-time reporter for the Daily Planet

Does leave one to wonder of Clark and Chloe were exchanging kisses under the mistletoe in that possible future.
On a side note, I also liked the sideplot of Clark playing Santa, especially his line about "the new and improved model" to the one little girl. Iffy about Clark apparantly saving a drunk Santa, but at least it lead to some fun banter between St. Nick and Chloe.
Overall, a fun episode to watch. Not one of the better efforts this season, but definately a lot better than some of the drek forced on the viewers in earlier seasons.