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A few points:
I agree with sakky that you can get an outstanding education at a state school or a smaller private school. In fact, if you look at the bachelor's degrees of the professors at CalTech or MIT, many of them went to state schools. (Engineering is a bit different; many of MIT's faculty went to MIT for both bachelor's and PhD.)
The reason people are upset with getting rejected has little to do with the education. Frankly, I think the education at a place like Northwestern may be superior to Harvard. Many ambitious seniors see getting into a college sort of like qualifying for the olympics; when they get rejected, it's like the college saying, "No, you are not _really_ an elite student." To use an analogy, it's like training your entire life for the decathlon, setting the world record in every event, and then they give the gold medal to someone with marginal athletic ability. It's not like the person started training/studying to get that gold medal originally, but that gold medal comes to symbolize success.
Also, I disagree that people complain more about MIT admissions than ivy admissions practises. Plenty of people are upset with the ivy league schools. I'm sure part of the reason people are highly critical of MIT admissions is the MIT blogs. Harvard admissions doesn't ever talk about their admissions process. All you see is the results.
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