DVDdoug:
Once when my company was working on some kind of joint venture deal, the boss mentioned that they needed to run it by the lawyer. Later when I asked him about it he said, "The lawyers always say 'no' because it's the least risky answer". (I think he went-ahead with the deal anyway... He was an entrepreneur, not a lawyer or bureaucrat.
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I'd imagine it's much worse at a university because you aren't the client... You are not paying the lawyer and there's no need for the lawyer to please you and they have nothing to gain and everything to loose by sticking their neck out.
You are correct that we are not the client. I believe "minion" is the term they use in the contract. That said, it would be great if they would occasionally say "no." But the way of the district is that questions go up, but answers never come back down.