The guilt is definitely pushed strongly in Catholicism and probably the worst part of it. But I don't think Catholics are too literal in their interpretation of the bible - in fact I think they are generally more rational than most other denominations. For instance, Catholics generally accept scientific explanations for evolution and the origin of the universe unlike many (most?) protestants.
Lifelong Catholic here -- I've never felt that the guilt was pushed too strongly. What I do feel is that the Catholic Church is very willing to say that certain beliefs and practices are proscribed, that sin is real and should be avoided. What people are calling guilt is their own attachment to sin, and their reluctance to abandoning it.
(That being said, God's capacity for love is beyond human conception and no person can ever be beyond redemption.)
