Taking Scripture literally

I've noticed people often criticize a literal interpretation of Scripture when discussing contemporary issues. If this practice is suspect, do Lutherans still accept the literal understanding of "Take, eat; this is my body" (Matthew 26:26) or "But in fact Christ has been raised from the dead" (1 Corinthians 15:20)? How are we to know which interpretations are acceptable?  

If you're implying that Lutherans often pick and choose which texts we take literally, you're right. So does almost everybody else. Lutherans have an interpretive "lens": the core and center of Scripture is justification by grace through faith. Martin Luther evaluated Scripture on how well it "brought Christ to us."