"If we allow them - the Commandments - any influence in our conscience, they become the cloak of all evil, heresies and blasphemies” (Comm. ad Galat, p.310).
Luther Exposing the Myth says their stated purpose is to show that "from Luther’s own words we shall see him for what he really was, that is a rebellious apostate, who abandoned the faith and led many into apostasy from God under the guise of “reformation” in order to follow his perverse inclinations." With this quote, they attempt to show that while Christ said keep the commandments, Luther says they become the cloak of all evil, heresies and blasphemies.
Luther, Exposing the Myth cites "Comm. ad Galat, p.310." I'm not exactly sure which edition of Luther's Galatians commentary is being referred to. There is a three volume Latin version of Luther's commentary on Galatians from the Erlangen edition of Luther's writings in which the quote is in volume 2 on p. 145:
Luther, Exposing the Myth probably took this quote from the reprint of Patrick O’Hare, The Facts About Luther (Illinois: Tan Books, 1987), 311 (page 315 from the original). O'Hare states,
In studying Luther, we must remember, that his cardinal dogma when he abandoned Catholic teaching, was that man has no free-will, that he can do no good and that to subdue animal passion is neither necessary nor possible. He insisted that the moral law of the Decalogue is not binding, that the Ten Commandments are abrogated and that they are no longer in force among Christians. "We must," he says, "remove the Decalogue out of sight and heart." (De Wette, 4, 188.) "If we allow them—the Commandments—any influence in our conscience, they become the cloak of all evil, heresies and blasphemies." (Comm. ad Galat. p. 310.) "If Moses should attempt to intimidate you with his stupid Ten Commandments, tell him right out: chase yourself to the Jews." (Wittenb. ad. 5, 1573.) Having thus unceremoniously brushed aside the binding force of the moral law, we do not wonder that he makes the following startling and shameless pronouncements. "As little as one is able," he says, "to remove mountains, to fly with the birds (Mist und Ham halten), to create new stars, or to bite off one's nose, so little can one escape unchastity." Alts Abendmahlslehre, 2, 118.) Out of the depths of his depraved mind, he further declares: "They are fools who attempt to overcome temptations (temptations to lewdness) by fasting, prayer and chastisement. For such temptations and immoral attacks are easily overcome when there are plenty of maidens and women." (Jen. ed. 2, p. 216.)O'Hare actually uses the quote two other times in his book. On page 114 he documents it as "Wittenb. V 272. b," and on page 119 as "Epistle to the Galatians." Exactly which book "Comm. ad Galat. p. 310" is uncertain. Perhaps it's an earlier Latin translation. In English the quote is easy enough to find. It can be found in Luther's Works vol. 26 (Luther’s Galatians Commentary) on page 365, commenting on Galatians 4:3. An older English translation can be found here.
I am not saying this with the intention that the Law should be held in contempt. Paul does not intend this either, but that it should be held in esteem. But because Paul is dealing here with the issue of justification—a discussion of justification is something vastly different from a discussion of the Law—necessity demanded that he speak of the Law as something very contemptible. When we are dealing with this argument, we cannot speak of it in sufficiently vile and odious terms either. For here the conscience should consider and know nothing except Christ alone. Therefore we should make every effort that in the question of justification we reject the Law from view as far as possible and embrace nothing except the promise of Christ. This is easy enough to say; but in the midst of trial, when the conscience is contending with God, it is extremely difficult to be able to accomplish this. It is especially difficult when the Law is terrifying and accusing you, showing you your sin, and threatening you with the wrath of God and with death, to act as though there had never been any Law or sin but only Christ and sheer grace and redemption. It is difficult also, when you feel the terror of the Law, to say nevertheless: “Law, I shall not listen to you, because you have an evil voice. Besides, the time has now fully come. Therefore I am free. I shall no longer endure your domination.” Then one can see that the most difficult thing of all is to distinguish the Law from grace; that it is simply a divine and heavenly gift to be able in this situation to believe in hope against hope (Rom. 4:18); and that this proposition of Paul’s is eminently true, that we are justified by faith alone.
From this you should learn, therefore, to speak most contemptuously about the Law in the matter of justification, following the example of the apostle, who calls the Law “the elements of the world,” “traditions that kill,” “the power of sin,” and the like. If you permit the Law to dominate in your conscience instead of grace, then when the time comes for you to conquer sin and death in the sight of God, the Law is nothing but the dregs of all evils, heresies, and blasphemies; for all it does is to increase sin, accuse, frighten, threaten with death, and disclose God as a wrathful Judge who damns sinners. If you are wise, therefore, you will put Moses, that lisper and stammerer, far away with his Law; and you will not let his terrors and threats affect you in any way at all. Here he should be as suspect to you as an excommunicated and condemned heretic, worse than the pope and the devil, and therefore not to be listened to at all [LW 26:364-365].Conclusion
Luther, Exposing the Myth and Father O’Hare are engaging in a fallacious selective citation process. Luther is here speaking with a law /gospel distinction in regards to justification. Just a paragraph later Luther says, “Apart from the matter of justification, on the other hand, we, like Paul, should think reverently of the Law. We should endow it with the highest praises and call it holy, righteous, good, spiritual, divine, etc.”[Source: LW 26:365].