Unfortunately for those involved it doesn't appear as though it really matters what they do: http://www.thecrimson.com/today/article506247.html
I think it's clear that with this becoming such a public issue, that HBS doesn't have much of a choice. In other words if they decided to now accept applicants that the media views as *hackers*, it would be another piece of ammo to claim that HBS doesn't support ethics. Additionally some alumni and potentially some recruiters may complain. Under the spotlight, it doesn't have much of a choice.
This isn't to say that I believe they should summarily reject all involved, it's just to say that it's the logical (and unfortunate) conclusion given the timing and under the spotlight.
If I were considering reapplying, I would definitely send a letter of apology.
I really do feel bad for the people involved though -- especially those who've been invited to interview in the last couple of days.