Your valuing history too much. When your going to recruit today they really don't care what happened decades ago. The thing that IU has going for them is they have a loyal fan base and they are dedicated to basketball. In the recruiting circles its more what have you done for me lately? Who have you placed in the pros? Quite frankly a kid today isn't going to care about Steve Alford or Damon Bailey. Heck if you ask them the probably won't even know who they are, unless Alford is recruiting them.
Powerhouses of yesteryear are just that, powerhouses of yesteryear.