When one thinks of singers trying to act, the first culprits that come to mind are Frank Sinatra in "From Here to Eternity" and "The Manchurian Candidate", or Elvis Presley in anything. Usually, the crossover does not work because a particular kind of singer may just have too much personality (or "baggage") to fit himself into a particular role.
Here, though, the transfer works, and it is a result of the kind of singer Willie Nelson was, and always has been. His style of delivery as a musician is all understatement, quiet nuance, and behind-the-beat phrasing. There is a sort of conversational verisimilitude in his singing that crosses over into acting (screen acting, at least). His style of singing is almost the equivalent of the "method" school of acting -- it is all psychological and physiological recall.
So, Nelson is nearly perfect as Parson Shays, for that reason, and for another; the character was already fully-realized in the musical album version of "The Red-Headed Stranger." The screenplay is largely just a fleshing-out of Nelson's narrative vision. If you doubt that, give the album another listen; it has a surprisingly coherent, and direct storyline that connects all of the songs (even several not penned by Nelson himself, most particularly Hank Williams's "Blue Eyes Crying in the Rain").
Now, of course, the question still remains: how good is the story itself, and how well has it been rendered on-screen? This is not a Western on par with Leone's, Ford's, or Eastwood's. Nor it is meant to be. It is, however, remarkably well-crafted bit of movie-making. For those who object to the seemingly amoral content (the murdering of women), the only response is that a piece of narrative fiction is not a sermon, and artistic judgment is not the same as moral judgment. Furthermore,the old-school, "white hat/black hat" type of Western was already on its way out around the time of "Shane."
