Getting banned from committing to the most important and critical open source project out there cannot be good for a university.
The teaching hasn't changed, and the CS field is a very large space, and the Linux kernel is a prominent but small part. That's not to say the Linux kernel is insignificant, just that the CS field is very big.
Personally, I see this as a group of researchers going about it outside well-understood ethical patterns for pentesting and getting punished for it. I think it's necessary for the university to be made an example of, but I don't think it necessarily reflects badly on the whole CS department. Hopefully the IRB does a postmortem of this and concludes that ethical review also needs to field-specialist input in general.