Herman will be gone long before he ever earns that money at Houston. He won't stay there.
Diaco is paid well enough. If you look at the list, young coaches don't get paid as much until their second or third stop. Diaco is a first time HC so won't make as much. But if he can win here, somebody else will offer him $2.5-$3M. Is he then an appropriate P5 hire in your view?
Diaco is a great ambassador. He looks like a solid program builder to me. He's a decent recruiter. He's still got issues as a game coach, but that's the easiest part of the job. He's certainly not a failure.