Genghis
Good - with the exception of accreditation as an aero eng degree (due to what I'd perceive as a diluted level of engineering), an excellent idea. Aviation as an activity can in some areas require degree-level qualified personel. A beefed-up Embry-riddle model might be a good starting point, as well as the available UK-based maintenance degree programmes. My institution tried to get involved in such a programme some years ago, but it failed to materialise due to differences between the partners. A great shame.
However, there is no place for a PPL as a module or course in either a new aviation degree or a more traditional aero. eng. degree. The material simply doesn't meet the academic levels required of a degree. I must emphasise that's not to say a PPL or other flying qualification isn't important to providing a rounded aeronaut, it's just that it isn't academically advanced enough. That's not snobbery, or elitism, it's just the way it is.
By all means offer a PPL with the degree, but it shouldn't appear on the degree scroll as an academic element of the qualification.
Having said that, some of the best engineers I know are pilots. Some of the best pilots I know however aren't engineers or have a university degree. Offering a flying qualification as currently done in the UK in the context of the degrees on offer is just marketing. And don't expect rounded individuals just because a complete aviation programme (with or without flying) has been put together. Students want to pass exams. They compartmentalise ie they won't use the knowledge gained in one subect or year to help them in another. A flying qualification would become just another module to pass (albeit a rather sexy and appealing one), and its relevance and context would either be lost on them, or of no significance in the context of the exam-passing sausage machine that masquerades as 'education' in the UK just now.
The most important element of your course will be staff. You'll need aeronautical enginners who work in academia, not academics who've done aeronautical engineering. UK universities struggle to recruit the former as we now always have one eye on the Research Assessment Exercise - currently it'd be madness for a UK university to go out and recruit from industry engineers who don't have a raft of scholarly journal publications obtained in the current assessment period, and who can rapidly generate research income from external sources. How many engineers out there in industry have that kind of CV? (yourself excluded, of course!)