Yes, if anyone starts losing a ton of money, they will probably stop whatever they are doing whether we are talking sports or banking. What I am asking you to answer is this: What does the NCAA folding have anything to do with a loss of revenue or an increase in losses? The NCAA isn't paying these schools because the NCAA isn't making money. The NCAA is simply an ineffective enforcement body and a minimally effective administration operation. Hell, with the rise of conferences as the main power player in TV negotiations, you could argue that the NCAA is mostly obsolete in the negotiation arena as well. If the NCAA dies, how does that have any impact of the revenue/cost/profit/loss of college sports?
The paper is full of holes, the biggest one is this: While top-tier players may be worth 250K or whatever this article supposes(artificially), if the NCAA collapsed it would be replaced by another governing body. If that governing body can't keep the scholarship model intact, it would fall to a true market system. If that is the case, then the market would bear what the market would bear. Each Athletic Department would pay what it would pay or not pay, and that would divide the athletic marketplace accordingly. D1 wouldn't be divided by number of scholarships available but by cost each conference would allocate for each player. Maybe the SEC is 50,000 and the Big East is 10,000, for example. But its not like sports would die, they would just be run much more like businesses than before.