players can't just transfer and play the next year. they have to sit out a year before a player can play for the new school
They can if the NCAA grants a special waiver, which it has frequently done in the past with institutional punishments. Even people hoping for the death penalty have asked for that waiver to be given all curent PSU players.
No one is trying to hurt the current players. They may be inconvenienced or disappointed by the punishment, but their lives will not be ruined.