If you're imagining a student driving to class, you're imagining a very different kind of environment.
In the schools where these kinds of demands are made, the university provides your housing, food, utilities, medical care, the centers of your social life (both in terms of facilities and student organizations), local police department, credit union, etc. Even if you live off campus, the entire neighborhood is an (unofficial) extension of the university community. Even if you're at a private business, the university probably owns the building and leases to that business. Private apartment building, your neighbors are all students and faculty.
This typically happens in a small, walkable enclave where it would be very strange for a student to have a car or commute in from outside the enclave. The university owns every part of a student's life in this case, and it's reasonable to think it has some responsibility to keep its community healthy, within reasonable limits.
Your criticism seems more applicable to a commuter/community college, not a residential one.