While the alums may be bummed out, at least the kids will get to finish...that's a better deal than puppy mill students get when THEIR school closes.
Honestly I find it hard to argue with ITT on their reasoning...any rational calculation of return-on-investment simply does justify the cost of a four-year aviation program. Trust-fund babies are one thing, but most students will be in debt for decades, with nothing but bus-driver wages to show for it (not counting the 1% who will finish as widebody CA's at FDX).
It seems like ITT took the ethical road...just because the students are blinded by their passion does not mean that it's OK for institutions to take their money.