After thinking about this over the weekend, it's clear that there is no real definition of digital literacy - the term obviously means different things to different people. That explains much of the wooliness of the debate. For that reason, it seems to me that the best way forward is to try to cut through the fog by adopting a pragmatic approach and avoiding the worst of the confusion.
Hard skills, e.g:
Statistical software (R)
Teach in house, integrate with curriculum.
Soft skills, e.g:
Keyboard skills (hugely important and almost always overlooked)
Outsource, augment curriculum.
I will be promoting this approach during out forthcoming curriculum redesign process. Will this view prevail, or will the whole thing get swept under the carpet because we can't agree what digital literacy is for our students?