You should take into account the fact that many of the participants are overwhelmingly drunk. Many students will jump to show just how much they hate the school up North, but many others will jump just to have an opportunity to get incredibly drunk on a weeknight.
I'm not concerned about the former group. Even if you have only one or two drinks to numb the burning cold, you should be able to take care of yourself. But the latter group? It's only a matter of time before somebody is too drunk to realize how long they've been in the freezing cold and has to have a few toes amputated due to frostbite.
Should the university sanction the event? I don't know. I lean towards "no", myself. But we also shouldn't pretend that it's a perfectly safe, fun day for the whole family. These are drunken college kids in a freezing cold lake, and sober college kids can be incapable of making mature, rational decisions.