I think it's a matter of time that App State releases him. Unfortunately, when it happens it will likely be too little too late. The fact that this is becoming a national story, it's already painting their program in a bad light. If I'm a recruit that is anywhere borderline high-major or any recruit to that matter who might think "If for some unforeseen reason something happens where I might need to reconsider my decision", is not going to even give App State a sniff.
The longer this takes, the less options Graham is going to have. Teams like UConn are likely going to fill their PG needs with some other player. I guess there's always going to be a team that has an open ship and will take a talented player like Graham even if they have another PG in the fold. It's not uncommon for a team to take a player for depths may it be a back-up or upgrade to who they already have, especially when it comes to the PG position.
IMO, there are two areas that can make a great team good and a good team bad. One is not having enough size to defend the paint and get some easy points in there. I always say, "You can never have too many bigs!" The other is is not having good PG play, which usually means having a solid starting lead guard and at least one who can fill in while he's on the bench. I recall one of the talented MSU Sparty teams that had a ton of talent at the 2-5, but no PG. It killed any chances they had for a deep March Run. I'm sure we can all point to this talented team or that one that just couldn't get things done due to poor PG play.
As a hoops junkie, this would make an interesting thread about what areas of weakness can really bit a team in the ass. I think I'm going to start a new thread on this topic for those interested in chiming in. For example I can remember one or more of our talented UConn teams getting exploited due to poor perimeter D, particularly at the 1 & 2 due to guards that were simply not quick enough to stay in front of the opposing guards. Even the best Team-D scheme can get blown up if the guards can't prevent the opposing guards from blowing right by them and forcing the bigs to have to step up and close off shooting and passing lanes. It's one way that you can get your bigs who might be the strength of you team in early foul trouble and let the game get out of hand real quickly.