If 20% of students at NYU cheat (I can't access the original post to check the numbers it mentions, obviously, but I remember it being something like that), then NYU's reputation should be very damaged by that fact.
Regarding the parable, I see the point and how what I wrote could be interpreted in the way that you describe. My intention was to refer to the city as the whole academic system. The "Redwich Village" is a reference to Greenwich Village, the neighborhood in NYC where NYU is located.
So, Redwich Village stands for my institution, which was attacked ferociously as being the harbor of cheaters over the last few days, while people fail to recognize that this is most probably a more generic problem. You may claim that I overgeneralize without proof, but I have sufficient evidence from other people that this is the case. Especially after all the emails that I received within the last few days where people described their own experiences with cheating that were very similar (most did so anonymously, but with specific names of top universities around the world).