This "club level" idea as an alternative to intercollegiate teams is just so simplistic. It assumes that there is little or no cost to club level teams, and that's not true. There are going to be coaches, there are going to be uniforms, there are going to be officials, there is going to be equipment.
So you have two choices for the funding of a "club" team; via the athletic department either out of student fees or revenue sharing from other sports (meaning football), or user fees paid by the students themselves. The former is a cost cutting measure by removing scholarships, travel, etc., but NOT a cost elimination, and the latter makes club sports the province of students who have spare money lying around in a country where student loans now exceed credit card debt.
And I think it's important to understand that cutting scholarships doesn't "save" what many of you are assuming that it does. A school doesn't pay itself real dollars for a scholarship athlete; it is primarily an accounting matter. In fact, most state universities are allowed to count out of state scholarship athletes as in state for accounting purposes so that the school can take more high tuition out of state students.
The debate here is being framed in terms of idealism and putting the genie back in the bottle, both for college sports and youth sports, and that is not what's happening. The Ivy League isn't going to play football this year, and the dominoes are falling. The Big 10 has killed non-conference football games, with the ACC sure to follow, and the dominoes from THAT will not only be the non-revenue sports at those schools, but the teams that were counting on getting a couple of million buck for their athletic department for playing at Michigan or Alabama or Tennessee; more dominoes. If there isn't ANY college football played this fall, which becomes more likely every day, club sports are likely to suffer as much as non-revenue intercollegiate sports.
As to the youth sports thing, the days where kids play sandlot baseball, or pickup basketball, or backyard football are gone forever and they ain't coming back, no matter what happens to college sports and scholarship opportunities. As a high school coach, I lived thru the sales pitches of travel/AAU coaches about scholarships, but I'm not naive enough to believe that scholarship reductions or the elimination of entire programs are going to take us back to a simpler time in youth sports. That ship has sailed, and it isn't coming back. Air conditioning, cell phones, cable TV and all the other options that keep kids out of parks and away from pickup sports are still in place.
I don't know what college sports and/or youth sports are going to look like coming out of this situation in which we find ourselves. But thinking that we are likely to return to some imagined "golden age" of athletics is sort of silly, I think. Supply meets demand, and I see no reason to believe that elite athletes (and their parents) aren't going to seek elite competition in the future.
One other note: Don Mahaffey is spot on; this idea that funding athletics is somehow different than funding the arts, or music, or drama, or a host of other pursuits at the university level isn't justifiable. We can argue about proportionality, I suppose, but all the way back to the Greeks, intelligent people have understood that athletic excellence is to be valued and that athletic participation is of value. It is insufferably elitist to believe that a university should fund the arts, but not athletics.