Yes, it's grammatical! "Our being laid-back" might be a bit easier to swallow.
I'd make the "which" clause non-essential by placing a comma after "vulgarity." Some might consider the essential version incorrect from a symantic point of view, but I don't think it's a grammar issue.
"Appreciate" is the wrong word, in terms of my understanding and use of it. I know people say things like, "I don't appreciate your using obscenities in front of my children," but I think that's lower register.
I'd say, "We should never condone this kind of etc."