I'm inclined to agree with Orin that John Yoo's memos, while wrong and at times pathetic in their attempt to defend the indefensible, would not be anything close to grounds for termination of a tenured professor had they taken the form of a law review article. I don't agree that such ends-driven argument is the norm in legal scholarship—here I agree with Deborah—but it's certainly not unheard of, and it's unimaginable that anyone would propose firing a professor for a really bad, ends-driven law review article.
What makes Yoo's memos so troubling isn't that many of the legal arguments are bad—it's that it looks like he was basically writing a brief in favor of executive power when his job and his ethical duty was to offer a balanced interpretation of the law that considered the broader public interest. That's what Tim Wu was getting at when he wrote about Yoo sucking up to Donald Rumsfeld on the squash court. That's what several people meant, I think, when they said Yoo undermined the rule of law.
I always cringe a little when anyone talks in weighty tones about "the Rule of Law" because I worry that we conflate two distinct ideas, one of which is often wrong. One is the idea that complex legal questions have right and wrong answers that are apparent to people with sufficient professional competence. I'm often quite skeptical of this claim, for reasons I won't detail here. The other idea is that our legal system requires people in certain positions (judges, counsel to governmental agencies, and officials) to act and decide legal questions in the public interest rather than in the narrow interest of some specific client or constituency: In the old days, people spoke of "the rule of law" as opposed to "the rule of men." This commitment goes the very heart of what it means to be a profession (and I think you can believe believe this without believing that what the professionals must do is find the "correct" interpretation of a legal text or arrive at the "correct" resolution to a legal dispute).
The concern is that the Yoo memos undermined the rule of law in this latter sense. As Phil suggests, such a breach of professional ethics might make him unfit to train future lawyers—it would certainly make him unfit to teach legal ethics. That is different than a bad law review article, where it's arguably consistent with the job (though not the job at its best) to write ends-driven work—at any rate, it certainly isn't a breach of any ethical duty. But we'd need to know whether Yoo was in fact simply writing a brief for executive power, or whether his was a sincere—but failed—attempt to interpret the law. That's why Chris Edley's letter noted that Yoo believes his arguments are sound. If that's true, then there's no ethical breach—only a bad argument. And bad arguments, as Orin points out, aren't all that uncommon in legal scholarship and certainly aren't enough to get you fired.
So, Yoo's memo may not be enough to discipline him under Berkeley's standards (and they probably shouldn't be enough: I'd hate to see the types of witch hunts that could get whipped up if we started trying to decide whether lawyers in government service who made very unpopular arguments were sufficiently sincere to merit keeping their tenured appointments after they leave government service). But there are sanctions that collectivities can impose other than formal ones. I bet students and colleagues will make Yoo's life sufficiently unpleasant that he won't want to stay: I give him two years at most before he resigns voluntarily.