walk ons automatically disappear after the season unless for some reason you give them a scholarship. I'm a superclass kind of guy, so I can't offer much help in the balanced class issue, other than to say don't be afraid to still use the red-shirt when beneficial just to avoid throwing off the perfect 3-3-3-3.
The ineligible kid needs more minutes of study hall in your practice plan. I've never seen someone fail twice in a row. I do know that kids who fail the second semester come back eligible the next season, but they typically do not gain as much in off-season development as others to represent going to summer school to make grades.
GL, and feel free to hit me up via sitemail if you have any specific questions. I'm overall just a fair-to-middling coach, but I'm pretty good at whipping teams into a high level of mediocrity, and from there the rest is up to you