On a side note, there are the students who turn down Caltech/MIT for state (often for financial reasons, or for programs the state university is specifically strong in). I know a couple of them. It's actually pretty interesting how some of them aren't the most scientifically self-motivated people out there. They usually become somewhat involved with the social scene of their respective universities, and take normal course loads (and follow normal course sequences). They probably aren't getting a Caltech/MIT equivalent education, although they're still likely to go farther than their counterparts (a "drink the firehose" curriculum wouldn't be the best learning format for a lot of people).Without the social groups, it's often difficult to maintain the motivation needed for studying at levels comparable to those that Caltech/MIT students study.
And yes sakky, I'm aware of the research that shows that average income of people who turn down Ivy for state is pretty much equivalent with the average income of Ivy league alumni.
Generally though, since genetic factors play a very large role in career outcomes (as evidenced from adopted twin studies), irrespective of the institution the student attends, I don't think that the institution makes that much of a difference. Then again, student personalites may still be malleable in the university setting, and students do develop social standards that they compare with to their peers, and this accounts for most of the variance in behavior that genetics doesn't explain (source: The Nurture Assumption). That being said, we must ask the question, "just how malleable is personality from the time the student enters college and is already 18?"
We have to make the distinction between theoretical possibility and practical possibility. Theoretically, it is possible for a number of students to obtain Caltech/MIT-equivalent educations in a state university. But an important question is - is it practically possible - that is, would most Caltech/MIT-calibre students who enroll in state universities get Caltech/MIT equivalent educations given what they're likely to do in a state institution?