@4kids4us This definitely happens. My youngest went to Eckerd - no one around us (including us) had heard of it before it was suggested to him. There’s a young lass from his school going there this year and now it’s a recommended place to consider if the fit seems right.
The well-known academic schools also run into “huh?” issues too as @doschicos stated. Whenever I mention Rice, the most common response is a chuckle, followed by, “Oh, you’re serious? That’s a college?” That typical response around us turns many off from even considering it TBH.
I fully agree that most folks “on the street” know a couple of Ivies, Stanford, MIT, and big name sports teams - learning more if a team becomes good for the year, but often with a “Where’s that?” accompanying it. Around here they’ll know Slippery Rock, Shippensburg, and Kutztown though. Very doubtful if most could place those PA schools on a map, and many would have the same chuckle first wondering if it’s a joke.