I honestly think they're about to turn it around and destroy ND next week(which pains me to say as an OSU fan, but I hate ND too so it works out). If you watched the whole game yesterday(cheering the whole time) you may have caught a scene where Mike Hart refused to leave the field to let his backup in while he briefly cramped up.
Shortly after a freshman WR kicked one of the Oregan DBs in the knee, and Jake Long got in his face and totally tore into him. Ya it sucks that their seniors are just now getting that fired up, but for a team that has like 14 of them starting, and the entire big10 schedule to go still, they could technically turn it around.
That team is too talented to stay down all season, bad coaching or not. Eventually pride takes over and the players will will themselves to some wins.
Also, the spread offense works against teams like Michigan because they ARE aggressive, and they ARE physical. That's exactly what it was designed to do, crate space so hard hitting physical linebackers need to cover faster slot receivers, small/quick tight ends and running backs.
ESPN just did a little break down of the spread offense actually because of the App state game and it describes perfectly how it works against a team built like Michigan, and most of the Big10(traditional type teams, run the ball on O, stop the run on D).