It's never been confirmed or proven that Schiano actually saw anything. McQueary gave a second hand account of Tom Bradley intimating that a decade prior he had witnessed Schiano saying he witnessed something. That's pretty flimsy evidence to label the guy as an enabler to a child molester. I'm not saying it didn't happen, but basically McQueary's point was that other staff knew of Sandusky's reputation. We don't know what happened beyond hearing Schiano witnessed something. Maybe Schiano did report it to Paterno who swept it under the rug, that's not unrealistic to believe based on how Paterno and others handled things later on. Based on how hard it was (and still is) for people to accept what Sandusky had done and Sandusky was still so popular and relevant at that time, Schiano would have likely been blackballed from his profession. Doesn't mean he shouldn't have reported it or that he did the right thing, but try and think about it from his perspective. Brand new coach, probably somewhere in years 1-3 of his first coaching job, had to accuse the right hand man of the most powerful man in college football of molesting a child...
I don't look at Schiano as a scumbag, if the story is true I think he's a guy who ultimately made the wrong choice (if in fact he did not report), but was in an extremely difficult position. He's a great defensive mind, his teams have always been tough. I think the fact that Bill Belichick really liked drafting Rutgers players during Schiano's tenure speaks to how well those players were coached. We could do worse than Schiano.