Alright, let me put it together as clearly as possible and then I'll shut up:
1. Ron Guenther had a tight-knit, very loyal group of donors who adored him. Shad Khan, notably, was part of this group.
2. Guenther was essentially fired by Mike Hogan, and then Hogan hired Mike Thomas with virtually no consultation from this group, whose money was the lifeblood of the program.
3. These donors were furious, and hated Thomas for it, from day 1. They have been very publicly airing their grievances about him, fair and unfair, to anyone who will listen for years.
4. Sometime before Wise resigned and Beckman was fired, these donors started spreading the idea that Rick George, who they all respect and believe would advance their interests, was interested in the Illinois job. Whether this was true or not, I don't know, but the idea got out there.
5. The donors pushed Wise to fire Thomas and let them court George. She steadfastly refused and stood by Thomas.
6. Tim Killeen becomes President, new to both Illinois and athletics, and Wise is fired as Chancellor, opening up a leadership vacuum.
7. These donors sense their opportunity and make a big push, swearing they have George in the bag (who the administration, rightly, sees as the strongest candidate) and threatening to end their financial support of the program if Thomas isn't ousted.
8. After some tug-of-war, they get their way, after covering the big buyout needed to get Thomas out.
9. A big offer is made to George, he considers it, but says no thanks.
10. The donors, without a white knight to reestablish their dominance, resolve to muddy and sabotage the process, so the next AD is someone weak who they can control. They hold their money over the head of the administration, cook up a story that George is still interested, and gum up the process, leaving the totally inexperienced Barb Wilson on an island with no one to support her but a search firm.
I'm not sure, honestly, how Craig Tiley plays into all this. Maybe he's the Guentherite backup plan, maybe he was never interested and the story about him interviewing is just meant to make the new AD look bad by comparison. But the whole George thing is a ruse meant to empower the ECI bluehair Guenther brigade over the interests of the administration and the fan and alumni community at large.