No, the pepper spray is NOT established procedure for moving peaceful, non-violent protesters.
As I said upthread - you protest, the University calls the cops, you refuse to move, they tell you to move or they'll move you, you sit down and link arms, they say move or you'll be arrested, you go limp, they use plastic cuffs, pick you up and carry you to the buses, to the station, process you, desk ticket, release, voila.
There's no part of that involving weaponry! There has never, in the decades this has been the standard procedure, been weaponry.
As for the best plan being to move when the cops tell you to - I honestly can't believe the number of people who appear to for themselves or say they'd tell their kids to just do whatever a cop says, apparently under any circumstance.
They're staging a protest. Of course the cops tell you to move - of course you... don't.
As to whether the U has the right to tell them to move, it's a public school, hence there's a debate to be had as to how private their sidewalks actually are.