You're absolutely right. Some things definitely need to change. The 3 and out rule is probably just the first of many.
A "minor league" for football could and should be established. Works for everything else, why not for the NFL.
Makes college football like what baseball, basketball, soccer, and the rest were always meant to be - amateur athletics by true student athletes.
The only problem I see with what you wrote is really towards the end. I could see a team like Florida who can't out-recruit Bama but decides to simply outspend them. Brings in a "mercenary" team of former NFL career backups for example to come in, spend a semester, and win a national championship, which would be what I could easily see happening if allowing former pros to come to college. Even though they're all backups, they're still much more mature, stronger, faster, and have a much smaller learning curve than the typical true college athlete- even the ones at Bama. Personally, I wouldn't care about it other than the fact it would be a true safety issue. Same thing basically as allowing high school players to play midget or junior high ball.