Not to pick nits, but to keep everyone honest...
The veracity of the "dumping tons of embers" angle is left to historical anecdotes. Some people swear it happened all the time, in great quantities, eventually bringing about the Great Chicago Fire. In most cases, those that say it do so either in expressing a distaste for Bonfire (if not a full-on opposition to it), or as Bonfire folks blowing smoke (so to speak) about how big and bad their Bonfire is. Conversely, those who say it didn't dump embers will also say "there's no reason you can't burn now." Point is, with nothing beyond stories to back it up and the fact that these stories have more to do with agenda than actual fact, from my view this angle doesn't work for anyone.
Which brings about the second point. Given the current state of, well, the State, Bonfire would not burn on campus for the exact same reasons it wouldn't burn off IF A BAN IS IN EFFECT. The University and Bonfire share friends and neighbors who are hurting, watching their livelihoods and property disappear. No matter what precautions anyone was to take (the University or Student Bonfire) it comes down to a big GD fire in a drought-crippled state. It presents a face of ignorance of our friends and neighbors. The nation would look on with their soundbites and talking heads and otherwise limited information and say "How damn bad can it be? They just burned a four-story campfire." So there's the problem of extra-local perspective.
This says nothing of local perspectives. No amount of publicity and outreach is going to make everyone in the area aware of safety precautions that have been taken to make the event absolutely safe (extra fire crews, wetting the property, cutting and clearing any trees alive or dead for 1000 yards, etc.). Of the many who are left not aware of these measures that may have been taken, more than a handful will see or hear of a big-ass fire and they will either march down to local government and ask "what the hell made this thing so special" and "don't you know they could burn the state down." Or worse, they march to their shed, get the gas and light up that 15-month-big pile of trash on their drought-land property.
For these reasons, in these times with the area having a larger-than-ever populace and development, there would be no lighting IF THERE IS A STANDING BURN BAN on or off campus.
Bonfire 2011 in Pictures