As terrible as the whole thing is, this really is out of the NCAAs jurisdiction IMO. Kinda like how they threw the book at Penn St, then relented and gave back schollys when the lawsuits starting coming.
The people at MSU that turned a blind eye to this need to be punished to the full extent of the law (or worse), but taking away scholarships from non-revenue sports and banning those sports for post-season play is not solving any problems.