Thankfully this ridiculousness is finally being put to rest, according to LeoKitty on Twitter, also the proprietor of the blog "The Girl Who Loved Andy Pettitte" (h/t to Proctor's Arm and Sliding Into Home for also picking up the story).
Hey look! There's even an authentic camera phone blurry shot to prove it:
It seems like they tried to adopt an airport-style testing bin, illustrating the size that a bag is allowed to be, but then they laid out the exact specifications on the sign (16x16x8). For those of you who need something more official than a photo, the Yankees have updated their handy A-Z guide on Yankees.com:
Diaper bags, small backpacks, small purses and bags are permitted. However, in accordance with Major League Baseball security regulations, bags larger than 16 x 16 x 8 inches will not be allowed into the Stadium. Briefcases, large backpacks, large purses and bags, coolers and hard-sided bags and containers are also not permitted. All bags must be thoroughly inspected before they are permitted into the Stadium. Box templates shall be used at inspection points, and bags and their contents must fit without assistance, modification or adjustment. The Yankees reserve the right to inspect any bags, clothing or other articles prior to entry into Yankee Stadium and prohibit entry or require removal of any items the Yankees deem inappropriate or potentially injurious to Yankee Stadium, other patrons or field personnel.