I think any transfer should have to sit a year, no matter the reason. They have signed a contract basically and if they want to break that commitment, then they should have to sit. People in the working world sign employment contracts and there are negative consequences for breaking them. Just my two cents. Thinks like letting Mark Smith play shouldn't happen and it has nothing to do with him. He decided he didn't want to be at Illinois, which is fine, but like most every other transfer out there who decided they needed to be at a different school, he should have to sit.
Whether it should be this way or not, kids commit to a coach and a school, some more towards one than the other. Can't blame kids for this, nor can you blame them for the firing of the coach. That's major upheaval in a kids life, considering how much time they put into their sport. Similarly, a sick/dying family member who has years or less left and lives across the country from where the kids attending college is the exact reason hardship waivers should and do exist. Forcing kids who can't even drink yet to essentially choose between school/sports and a loved one is messed up in many ways.