Based on my research (see below), Christmas lights are entirely secular, and therefore there is no problem whatsoever with looking at or enjoying Christmas lights.
Even if the lights are not entirely secular, there still wouldn't be a problem. The Shach (Shulchan Aruch 142:15), based on Tosfos and the Rosh, writes that it is permitted to derive benefit from decorations that are not directly used in idolatrous practices.
Rabbi Aharon Tendler directly addresses this issue, and rules that one may look at and enjoy Christmas lights, but he doesn't think it's appropriate to do so. His reasoning is as follows (quoted in full; emphasis mine):
The only prohibition to look at Christmas lights might be is they are used for Avodah Zara, and that you are actually benefiting from them by looking at them. Even if we assume that Christianity is Avodah Zara, the lights are not part of their worship, to the best of my knowledge. Also, most lights that are in urban areas, such as in malls and department stores are not part of a religious service at all, but rather used as a way to attract buyers to come shop. Additionally, merely looking at them would not be considered a Hana'ah (benefit). Consequently, there is no Issur to look at Christmas lights if you happen to be passing by them. I don't think that it would be appropriate to specifically stop for the purpose of admiring them, but I'd be hard pressed to find a basis upon which to rule that even that would be forbidden according to Halacha.
Based on my research, the modern practice of decorating the outside of the house with Christmas lights is entirely secular, and in fact can be traced back to a marketing stunt by Thomas Edison's Edison Electric Light Company! (Sources: Wikipedia, Library of Congress, Gizmodo, The History of Christmas Lights)
The secular nature of the lights continues to this day. As a professor at Yale states,
"One of the key aspects of the American Christmas light display is its secular
nature. Although some people do utilize lighting for religious exaltation — for example
with illuminated outdoor nativity scenes — the vast majority do not directly associate light displays with religion. Christmas lights have maintained many of their original nonreligious meanings..."
( Note how he only says that some people use lights to depict religious scenes. The lights themselves are not religious in nature.)
The practice of placing lights on the Christmas tree is older, and while the tree has Christian symbolism, the lights themselves do not.
The first decorated tree was at Riga in Latvia, in 1510. In the early 16th century, Martin Luther is said to have decorated a small Christmas Tree with candles, to show his children how the stars twinkled through the dark night. (Source)
The use of special lights on Christmas originally started with putting small candles on Christmas Trees in the home. Christmas Tree traditions go back to a Germany in the 1500s, and it’s believed the idea to put lights on the trees was started by Martin Luther, a famous priest who was inspired by the prettiness of stars twinkling between evergreens while walking home one night. (Source)
While the general practice of lighting lights in the dead of winter can be connected to pagan Winter Solstice rituals, by this point in time any such association has been completely overwhelmed by the increasingly secular nature of the holiday.
However, in my humble opinion, a Jew should not decorate his own house with such lights at Christmas time, due to issues of "Mar'os Ayin" and "Imitating Gentile Customs."
As an interesting sidenote, there is a not-too-uncommon practice in Israel to decorate the Sukkah with strings of lights - identical to the strings Americans would call "Christmas lights." I don't know what conclusions can or should be gleaned from this observation.