This is an interesting thread. When I was pagan, I was a True Believer, and I believed that I had been Chosen by my goddess to be her Priestess. Because I had a Personal Experience.... yeah, I know. I even ran the local Pagan Pub Moot for ten years. But over time more and more "little things" kept not adding up. Eventually the local pagan community began to seem a little...silly. Finally I ended up being dead to the community over their lack of pride in their so-called Pagan Pride Day (weren't proud enough to put up a sign for it, so I wasted three hours trying to find it...seems there were signs, but they said, "Community Harvest Gathering" because they weren't quite proud enough to put "pagan" on a sign...and I confronted them about it....) So when I realized I was a skeptic/athiest....didn't really have anyone to announce it to. My Christian sister found my paganism hard to deal with, but she has at least one atheist friend and for some reason that's less scary for her. Go figure.
I have retained three friends from those days, one is now atheist like me (though we both came round to the conclusion independently), one says, "It (atheism) is often the next step for pagans" (does that mean I'm spiritually evolved enough to not need invisible friends?? :)), and the third hopes I will find my way back, but we have enough other things in common that we can get by without discussing religion or politics. (I didn't use the "a" word at first, I said I was a skeptic, and her reaction was a moment of silence and then, "Oh. One of them." She's so cute. She thinks she can control the weather. She watches Fox news. But we have other things in common.)
To answer the original post of this thread: In my group it was far simpler, and I didn't have to explain nearly as much. My husband and I simply told our group that we were taking a "sabbatical" ie. we were retiring. We had a long history with this group, and a long history with paganism, and like all good things, they must come to an end. (In truth, we grew up, and they knew it.) We only took with us the honorary titles of Crone and Sage. Even then, we don't use them in reference to ourselves, upon disclosing our non-theist viewpoint and stance on matters. They knew we were moving out of state, and that it would be hard to stay in touch with us. Since then, contact has been sparse, and those conversations were never geared towards paganism or our dealings, but more or less, just catching up on their lives in general in a secular level,(ie. new jobs, school, family, friends, happenings, births, deaths, etc.) We just simply lost touch, and found ourselves being better off for it.
That sucks that your friends would react that way :( I told my pagan friends about my non-theism, and they just seemed disappointed. Sad to see me leave the circle. But our friendship is still intact so that's good :)