I'm in favor. Frankly, it just makes sense.
As much as people say that kids commit to a school and not to a coach, that's not really true. Kids commit to a football program, and one of the key aspects of a football program is the coach, who controls the offensive/defensive schemes, etc.
You see it already with Purdue. Some players committed to Darrell Hazell, who has a very different football philosophy* than Jeff Brohm. Players who wanted to play the style of football Hazell was offering may not have been the right fit for Brohm's style. As such, by no fault of their own, they basically don't have a spot because the new coach frankly doesn't have any use for them, and Purdue has already lost some players to transfer this offseason** and is expected to lose more.
Now, that is the case when a team fires their coach. In that case, the idea that you'll have more than a handful of players jumping ship right after you fire your coach maybe gives an AD pause to just fire at will. For those of us that generally don't like the rapid-fire turnover in coaching ranks, knowing that you can't be so trigger-happy might slow down the craziness.
For coaches leaving of their own accord, I agree that you can't let players go to the team the coach left for. However, I worry here about allowing transfers, particularly for mid-major teams. I worry about turning G5 teams into farm programs, and if you let players transfer every time a coach leaves, you're going to see the biggest talents on those teams--the ones who will find landing spots at P5 programs--deserting G5 en masse. But I don't see a good solution here either, because allowing them to transfer when a coach is fired but NOT when a coach voluntarily leaves seems like a strange double standard to enforce.
* I'm still trying to determine what his philosophy was. It's a question that may plague me until my dying days. "Rosebud."
** I understand that this is the second offseason since his arrival, so it's not directly applicable. However I'm sure that if it was easy for kids to transfer without sitting a year out, the turnover on the roster would have happened more quickly after he arrived and started evaluating players, and a lot of those players leaving now wouldn't have wasted the year on Purdue's roster with no PT.