If ND is one of the only, or the only, major CFB program that requires or has a high percentage of attending-class players, I think their crop of 20-24 recruits signed every year will be BETTER than their current crop.
The sales pitch will be stronger, not weaker.
If Ohio State, Georgia, Tennessee, Texas, USC et al. are paying the same money as ND is to players, then the differentiator would be the academic experience and being surrounded by other student-athletes, not just guys fixated 100% on football. I'd bet ND would be able to land kids like Emeka Egbuka, Treveyon Henderson, Landon Turner, Keon Keeley, Christopher Vizzina, Xavier Nwankpa, Sam Okunlola and so on.
More Cam Williameses, more CJ Carrs, more Jaylon Smiths, more Chris Tyrees, more Blake Fishers, more Jaylon Sneeds.
They would, indeed, continue to lose out on the kids that don't want to play school. They never get those kids now.
Let the other schools slither down the drain together.
EDIT to add: More Braylone Jameses, more Ben Morrisons, more Tyler Buchners, more Kyle Hamiltons, more Christian Grays, more Drayk Bowens, you get the point.