Don't think about it from the perspective of the student athletes. Think about it from the perspective of the NCAA, who has shut the door for years to keep student athletes from getting compensation of any kind for playing sports. All that revenue is to go to the schools and the NCAA.
The lawsuit would open the door to current student athletes getting a share of the revenue. That is something the NCAA is fighting kicking and screaming.
As to your proposed change above: that would not work either. That would leave people open to making profits off of "Johnny Football" (the Heisman Winner from Texas A&M) using that player's likeness when he should have every right to protect his own image from other people profiteering while doing none of the work.