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Ok Here is the scenario. A unit of Fearless troops are tank shocked and the tank ends its movement on the far side of the unit with its rear portion over 2 models.
The way the rules read is any models that are under the tank have to move and the models have to move so that it is 1 inch away by the shortest route maintaining coherency. The exact wording is

"If some models would end up underneath the vehicle when it reaches its FINAL position these models must be moved out of the way by the shortest distance leaving them at least 1" between them and the vehicle maintaining coherency" (pg68)

So I moved the 2 units under the vehicle out from under the vehicle back up its path since it was the closest way to get it out and maintain coherency. My opponent said I had to move all the models along the path to clear the full route of the tank but I disagree

the rules also state

"If the test is passed (morale) the unit will simply let the unit move through as if it was not there" Which I take to mean that I don't move models along the route and only have to if it stops on the unit.(pg 68)

He said at Stone river, during a game, they made him move his unit to clear the path of the vehicle but that isn't the way I read the rules since it says " the unit will simply let the unit move through as if it was not there". Thoughts...

I believe you are right. If a significant portion of his squad was under the tank and there was no onther legal place for his units to go due to proximity to another enemy unit most likely, then they would have made him move the entire squad. Otherwise you just move the bare minimum number of troops, including those that are within 1" of the tank but not under it.

you are correct on both instances...if a unit passes it morale check it stays put and the vehicle moves as if the unit was not there. also you only move the models that would end up being under the vehicle or within the 1" range