When does Midrash cease being Midrash?

In this Hirhurim post, R. Gil Student posts regarding the story of Zimri and the Midianite woman recounted in this week's sidra.

R. Moshe Shternbuch, in his Tuv Ta'am Va-Da'as (ad loc.), homiletically offers the following background story: The Israelite men were attempting to reach out to the Midianites and bring them to faith in the Jewish God. However, in order to accomplish their lofty goal they needed to breach the chasm between the two divergent lifestyles. Therefore, they embraced some of the Midianite attitudes so as to be better able to influence the Midianites and bring them to the true faith. This corrupted the well-intentioned Israelites and led Kozbi, a Midianite princess, to convert to Judaism for purposes of marriage rather than belief. Zimri went to publicize his successful outreach program by showing off his recently converted Midianite wife.

However, this accomodation was nothing more than a distortion of Judaism that led to disastrous results. This program of outreach was so abominable that it led to the conclusion of the story -- the zealotrous Pinehas killed the two sinners who had brought Midianite attitudes and practices into the Jewish people.

R. Shternbuch continues to apply this to some outreach-oriented people in our day (without naming names) who, in our great sins, accomodate foreign attitudes in order to reach out to others. He strongly disapproves.

In the comments section, someone named Jeff rightfully zeroed in on the fact that R. Shternbuch is said to "homiletically offer" this take on it and said

I noticed you said that he homiletically offers the following background story. I assume you have been careful with your words: so baiscally R' Sternbuch made it up. The problem with that is, that in doing this, even if he makes a good point, he has twisted the words of the Torah to his own purposes. And since he has a lofty standing in Jewish society, people may come to think of this as true pshat in the parsha.

R. Gil correctly pointed out that "You have just condemned over a thousand years of Torah literature." In other words, the Midrashic approach.

Yet, it seems like there is truth in Jeff's critique. Frankly, anyone can project anything onto the Torah. R. Shternbuch isn't "anyone", but is his peshat no different than Midrash? If it isn't where do we draw the line? Not every accepted Midrashic collection is from Chazal either, so arbitrarily drawing the line at the midrash of Chazal doesn't seem to make much sense.