I think the FA screwed up on this one. Think about it... if you're going to take the captaincy from Terry, you should've done it when the incident happened, not 2-3 months later.
Secondly, the court hearing is not until after the EURO so technically Terry has not been found guilty of anything... yet.
The FA conveniently scheduled the hearing after the EURO so they don't risk loosing Terry for the EUROs, but now they want him to step down as captain. If you think he racially abused another player, then suspend him right now. You can't do this half-ass thing.
You just don't pull such a drastic move so close to the EURO. I think Capello made them pay for this stupid mistake.
Hiddink or Redknapp will both do well. They will have the players respect which will make the transition easy. I think Hiddink is the safer choice since he has experience turning teams around quickly. He will earn the players buy-in in no time and his tactics are easily incorporated. It's not like he's a manager who needs 1-2 years to get his team to play right.