I think the NCAA has some rights here because of the fact it is not just one coach that did something wrong, but the entire oversight on the part of other coaches, including the head coach, and the Athletic Department Director, and maybe even the University President broke down. It was not only the problem with a single coach, but with the institution.
The only problem I have with this is that the court case has not taken place yet. I wish the NCAA could have waited until the court case is actually settled. Without doing that, it seems as though they have already judged the coach and Penn State guilty, and that is not the way this country is supposed to work. It seems to me a penalty like this could even influence a jury. I'm not trying to defend the coach or PSU, but it just seems like we are jumping the gun here a bit.
We wouldn't want an ISU player who gets arrested kicked off the team before the legal process has run its course would we?
ISU had a basketball coach arrested on child porn charges. Some of those charges involved activities that took place in his ISU office, iirc. He resigned, and I don't remember the outcome of the charges and trial, but I don't think ISU suffered any penalties from the NCAA for that, especially not before the trial. Maybe the embarrassment was considered enough punishment.