Penn State needs to serve as an example for all the football idol worshipers in the country. Its punishment needs to be swift and harsh. If the university had any decency it would impose the death penalty upon itself, and perhaps that would serve as some sort of apology.
I may be wrong about this, but I believe the University of Chicago eliminated its football team back in the 1930s because of inherent conflicts of philosophy between a Division I football program and a reputable academic institution. They may have a team now, but they're a Division III school and it sure isn't a money-making operation for them.
Personally, I don't much care what the NCAA does or doesn't do to Penn State. The NCAA, along with the entire culture of college football, has been so thoroughly discredited and tarnished over the years that this Sandusky affair has barely even been on my radar screen.