Interesting that you mix morality with the question of mental health- I think a lot of people like to pretend they're entirely seperate constucts (political correctness?), but they aren't. They're not the same thing, of course, (this is assuming they both 'exist') but there's a fuck of a lot of overlap. Sanity is a subjective state of being that is loosely/mostly defined by the people who have the authority to do so (I used to think 'the majority' when I was more naive). Calling an action/thought/person/group of people/type of person insane is a way to dismiss them, oppress them, subordinate them, have and maintain power over them. Considering oneself to be perfectly rational and sane in every way serves much the same purpose, with the added bonus of self-justification.
I'm gonna throw in two quotes here I'm rather fond of on this topic, one from a (bad, according to the intellectual elite) movie and one from a (silly? girly? overplayed?) musical, but both with fabulously good points. If you dismiss them mainly/solely because they come from sources you don't like, you add to my point. I just think they're worded better than I can/could.
"You can't trust someone when they think you're crazy." -Gothika
"There are precious few at ease with moral ambiguities, and so we act as though they don't exist." -Wicked