I'm not sure where that info is coming from. According to cyclones.com, through 2012, ISU has played 121 seasons with an all-time record of 505-602-46. Per season that is 4.18 wins. You can't base it off a 12 game schedule because the 12 game schedule didn't even start until 2006.
http://www.cyclones.com//pdf9/2335086.pdf?SPSID=48323&SPID=4653&DB_LANG=C&DB_OEM_ID=10700
Normalizing it to a 12 game schedule is the only way to take into account that not every season is the same number of games. I didn't base it on a 12 game schedule over X number of seasons, I just took our historical win percentage and multiplied it by 12. I normalized our winning percentage to what that equates to in a 12 game season.
So using the numbers you provided:
505-602-46 is a winning percentage of 0.4380, or 5.25 wins in a 12 game season. My point holds.