to play devil's advocate, he's only proven that he can coach another coach's players far in tournaments. that's great for this year but what about next year? and the year after? there's a lot more to the job than that. how does he build a staff? how does he recruit? how does he develop players and get them to the league? does he have the aptitude to keep it going? think there are still a lot of question marks to be answered. (and i really don't know his history or track record before texas so maybe some of these are already answered)
He's been a head coach before with varying levels of success. He appears to be a strong recruiter as well.
The way I see it, Texas is an A level job and Terry is a B/C level coach. He's coached as an A level coach this year, but the fanbase and AD want an A+ coach and don't trust that Terry is the long term answer despite how well he has performed.
So I don't think anyone is in the wrong. You can't fault Texas for wanting the best possible coach. Terry was hired as an assistant, not a head coach in waiting. You can't fault Terry for taking steps to ensure he has a job next year either.
Terry was actually pretty fortunate. He just came off a less than stellar stint as a head coach at UTEP. Based off that performance, he had no chance of landing a P5 head coaching job. He got the opportunity to use a team built to win as an audition for new jobs, including the Texas job. I have a feeling at the end of the day, everyone involved will end up in pretty good shape going into next year.