I know someone making $33k/year (+ benefits) in New York City working for a publishing company after graduating from Stanford with honors in English literature. Even for people from top schools, job prospects aren't always that great if you didn't study something somewhat marketable

Also when the jobs market is low, unless you have something specific special about you (perhaps a particular specialisation in your degree) that an employer sees and wants, experience tends to count for more than any degree from any establishment. Employers are themselves being squeezed hard by the current economic state and so are more risk averse than they otherwise would be: favouring a proven record (even if it costs a bit more) over someone who will need more training and may need not work out after that training.

As the bad economic times drag on longer and longer the "experience costs a bit more" starts to fall away too, as more people with experience are floating around the job market getting desperate and so lowering their expectations.

That is why youth employment rates are being hit harder than the rates for people in the 25-to-50 age bracket (above that, ageism starts to raise its ugly head and can upset the balance back in favour of the cheap-to-employ desperate youth). Now is not a good time to be graduating.