So Cotton or Sugar would make more sense for Penn State... assuming there is logic involved in this process.
Sugar is always SEC champ (or replacement) vs B12 (or replacement), so no PSU there.
What we really need is a B10 team in the Cotton. For that to happen, the B10 team (Wisky or PSU, whichever is lower) to be in the last spot to be selected to a New Years Six game.
Basically, presuming Clemson and one of B12 or P12 champ is in the playoffs, since Virginia would replace Clemson in the Orange and a replacement from B12 or P12 is chosen for the Sugar / Rose, and since Group of 5 has a team in as well, we want Wisky or PSU (lower of the two) to be 9th in the rankings.
If Georgia beats LSU and gets into the playoff with LSU, OSU, and Clemson, we then want the lower of Wisky and PSU to be 10th in the final rankings, as B12 and P12 only get one team each into the NY6 and the 10th ranked team would then be the last one into the NY6.
In either of these scenarios, that lower ranked team gets sent to the Cotton, and then B10 still gets the Citrus. Then Iowa is no worse than the Holiday.