Sometimes we pay for the sins of our fathers and friends that went before us. This has always been how the NCAA works (just look at the recent USC sanctions with Reggie Bush & other schools). Besides, the players can immediately transfer without sitting out a year as they normally would.
As far as the students go:
1. I hope they didn't chose to attend their college based only on how well their team plays (or if it is bowl-eligible).
2. Some things, especially like this, are more important than a game and force all of us to take a step back a right the ship.
The "leaders" of their school put them in this position over money and image (which ties back to money) so now it was time to send a message that college isn't all about big time athletics and that gravy train. You should know the President of the Penn State University signed off on these sanctions before they were announced which leads me to believe he felt it was time to take our medicine and move forward.