More questions:
"How many schools will continue to offer four year scholarships as long as a student athlete fulfills his obligations on and off the practice field ?"
Reality is that few, if any, maintain a commitment to a four year scholarship. They may advertise it, the paper may say it's for four years, but if a coach wants a player gone, he's gone and no one is doing jackshit to stop him.
"If an athlete becomes physically unable to continue in his sport for whatever reason, will schools increasingly terminate scholarships in these situations ?"
What's new here? This situation has been taking place for years. Kid is physically unable to play, is retired for medical reasons, and stays on scholarship (ever hear of Nana Asiedu and Jordan Miner?). Doesn't count against player limits and the coach isn't responsible for the (financial) bottom line.
"How much worse will the oversigning problem become ?"
Not much worse than it is today given the hard limits that the NCAA and conferences have put on signees.
" I have to believe, if some schools perceive that they money is right, ways will be found to accommodate in season transfers."
University presidents are pretty much whores, but I doubt you'll find any who are willing to sell their ass so cheap as to deal with the flack if they allow that to happen.