I think the reason this story is so fascinating is because it covers so many topics and has so many implications
True. In the old days for colleges, people used to flunk out all the time, including a segment of kids that went to Ivies. But now with grade inflation, getting in is pretty much the entire ticket. To fail, something really big has to happen like a breakdown, addiction, abuse accusation, learning disability or cheating. Getting in is pretty much getting past the velvet rope.
College is now viewed as a marker. It's a way the fellow members of the "in" crowd judge you, for positions of power, for jobs, and for marriage. Employers were prohibited from doing aptitude tests (for a variety of reasons, including discrimination), so college became the stand in for the seal of approval In the old days too, college educated dad might marry his secretary or the stewardess he met on the plane. Now days high powered dad marries high powered mom, and college educated mom would never marry someone who is a drag on her income. Successful people marry each other, pool their resources, and tend to have kids that will also be successful (whether by genetics or environmental advantages).
Meanwhile, the superrich have been pouring money into universities (which now have high tech dorms, wifi, tons of administrators, and facilities galore). To compete, the very rich (but not superrich) throw their money, influence and connections too (sometimes, like those in the story, not entirely on the up and up). The upper middle class looks at it, and feels their children are now at a disadvantage, with all this money being thrown at the kids, and are worried about the shrinking opportunities in the economy caused by globalization, and realize that now a lot of college slots are going to for example kids from overseas (that's another iceberg that's coming...it's been a percolating secret that some foreign admissions from some countries might be doing similar cheating)....they get upset. The working class looks at this, and it's just another reason for them to get ticked off at the arrogant coastal elites, that's not only throwing 2 incomes they can't compete with at the problem, but that seems to look down on them too, and they don't get some of the safety valves afforded to the poor such as affirmative action.
People having fewer children means that you also have your eggs in fewer basket. Back when people had 3-6 kids, the odds are one would be successful (by hard work, athleticism, charisma, intellect or just plain old luck). Every family had a black sheep, and even if you wanted to you couldn't stay on top of all your children. Remember the film "Parenthood"? Plus we became more scared about our children, even though the world hadn't really become more dangerous, so we got helicopter parenting to protect these fewer eggs.
The story resonates because it goes directly to who were are as a society, and really plays into why the events of the last 12 or so years have unfolded the way they have. It touches everything as mundane as youth soccer, to why presidential politics operates the way it does, to our own children's futures. Dersh in the interview I posted above called it a watershed event....I think it really is and we're just seeing the tip of the iceberg right now.