Thanks for the reply!
Many of the points you raise could be issues with or without an endowment, and with or without Steem. I agree that there's potential for abuse there, but I'm not sure if the existence of an hypothetical endowment exacerbates most it. If Steem ever sees mass adoption, most of those risks will exist, regardless of any school endowments (in fact, they do already.).
As to Steem as a first cryptocurrency, a reason a school might want to make that choice is that the concept does not rely on an increase in Steem's price. I'm not aware of many others where the school wouldn't have to depend on the value of the token to rise. Of course, you're right pointing out that the corresponding drawback is that it's not a completely passive investment.
I want to highlight two important points from your reply that are specific to the endowment concept:
(i) Is there an inherent conflict in interest in asking unpaid students to perform support activities for a school endowment? On one hand, students are asked to perform unpaid fundraising and volunteer work for school-specific things like music, sports, and equipment all the time, but on the other hand, it's not lost on me that the @phillyhistory project wound up donating their account to a non-profit institute outside of the school when their project wrapped up in 2018. I don't know the full reasoning for that. It might help if the endowment is structured as an independent external financial entity, separated from the school by a so-called Chinese wall.
Of course, if appropriate, the school would have the option to limit support activities to paid faculty and staff.
(ii) Would regulators permit it? This is why I had the prominent disclaimer to consult legal and financial professionals. I couldn't begin to guess. I would hope so, but that could be wishful thinking.