Nope. He can (and still would) be canned for having an inappropriate relationship with a woman who, while she wasn't an employee, had a professional/business relationship with him. That's the point people keep missing with this. Even if Mel's account of events is 100% accurate and truthful, Michigan St can and will fire him for cause based on the moral turpitude clause. They have buyer's remorse on the contract they signed him to, and he gave the school a get out of jail free card.
The only way Mel comes out of this as something other than the villain is if the woman and the school conspired to set him up. I love a good conspiracy theory, but there's no way that happened.