It's true. Paterno had some spectacular defenses - 1968-69, 1981, 2004-05 - and some great offenses - 1982, 1994, 2005, 2008 - but 1985-86 may have been the most quintessential Paterno teams.
You're right Holtz never had their names on the jerseys. Notre Dame had names on their jerseys before Faust tho. There is a really cool article that talks all about ND uniforms. It's called "the definitive Notre Dame uniform history pictorial" by onefootdown. Com.
