I should have been a bit more specific when I mentioned Kuyper and modernity. I specifically didn’t mean “modernism” as a worldview, but the new social-cultural context that Christianity found itself in. He therefore fully embraced new learning and didn’t want to retreat into the past. This was why he founded a Christian university, which was not a holy enclave against the world, but a center of learning that fully engaged all the areas of learning, including (especially) philosophy.
On the question of how to interpret Kuyper’s idea of the two life-systems/worldviews battling each other, therefore, I don’t think it meant simplistic binary thinking for him. It certainly did not mean this for the Kuyperians I knew in Toronto. So I think that the version of Kuyper mediated through Schaeffer was quite different from the version I received. We need a reception history (Wirkungsgeschichte) of Kuyper’s ideas!
Perhaps the difference in the reception of Kuyper had to do with the fact that the ICS was founded by people who had done the PhDs at the Free University, and had been taught by Dooyeweerd and Volenhoeven (both philosophers), who seriously engaged contemporary philosophy, esp. Neo-Kantianism (which was important at the time). When I was at ICS, the profs were engaging many more recent philosophers, including Derrida, Gadamer, Rawls, etc. And there was serious philosophical discussion of the issues raised by these philosophers, to try and learn from them, not denigrating of them because they were not Christian.
ICS was not perceived by secular academic centers of learning as being engaged in a culture war against them; the result is that there was a lot of healthy dialogue between ICS and many secular thinkers, who often expressed deep respect for the ICS. You may know that Henk Hart (now retired from teaching philosophy at ICS) co-authored a book with an atheist philosopher in which they engaged in serious dialogue with each other (and they became friends).
The point is that my teachers at ICS constantly emphasized that the legitimate biblical distinction between the kingdom of God and the powers of evil could never be simply read off against any two groups in the world, but was a dynamic, ever-moving process that affected everyone, including Christians.