I want to say that Lou was getting very close to Knute Rockne's record for wins at ND. I think that played on behind the scenes and the "old regime" at ND did not want him to break it.
It has been so long ago I can't remember all the details, but I think that played into it as well.
Sort of like how all of our old folks felt that you needed to have played or coached with Coach Bryant in order to hold the reins at UA. Just some of that tradition stuff that can actually hinder your program.