It also could be that the recruit doesn't like the credit situation when they transfer. It's not a question USUALLY of getting in, it's what credits can you bring with you. If there is any interest in academics that can be a big barrier. Again this could all be a rumor as well...
I am both an Illinois and a Michigan grad. Assuming even partially true, issue could be less about admissions and more about what will or won't transfer, which if he cares anything about academics could be important. Happens all the time in football...