I think a distinction can be made between BLM lands, for instance, which are the vast majority of public lands, and park lands, cemeteries, historical properties, and such.
National forests could be kept intact, controlled by the individual states. BLM lands could be simply sold or granted by lottery though I would limit the buyers to US citizens only for a couple of generations.
http://www.blm.gov/wo/st/en/prog/blm_special_areas/NLCS/monuments.html
I get nitpicky about this because an overbroad generalization leaves us open to the charge that we would privatize land that most people consider part of the "crown jewels" estate. We have to be careful to emphasize that we are talking about lands that have historically been used for economic purposes, and that will continue to be used responsibly.