In the years 1929-39, church-state relations in fascist Italy did improve to some extent. The Lateran Treaty of 1929 between the Holy See and the Italian government helped establish a more cooperative relationship between the Catholic Church and the state. It recognized Vatican City as an independent state and granted the Church certain privileges. However, it's important to note that the fascist regime still maintained control over religious activities and sought to integrate Catholicism into its ideology. So, while there were improvements, it wasn't a complete separation of church and state.