Sandusky cost the school money.
The alternative to settling with victims was to litigate 20 to 30 claims. That's 20 to 30 individual trials. That's 20 to 30 victims testifying as to all the gory, sick, perverted acts that JS committed. The media would love it. The cases would drag on for years and so would the bad publicity. Wouldn't THAT be attractive to potential recruits and other students? Not to mention the costs. The lawyers would get even richer. And in the end it's possible PSU would lose many of those cases and have to pay whatever amount a sympathetic jury decided to award. You want to assume PSU would have won, but sexual abuse of children can inflame a jury like little else. It's an unwise gamble to take under these circumstances.
You're assuming that and it's a failed argument. One or two cases beaten in Court and the others have 2nd thoughts. The BoT blew this, to cover their behinds.