As long as you can feel that you will be reasonably happy at your state flagship then I would say to transfer. You shouldn’t have to suffer through the next three years. Without knowing the State it’s hard to get too specific…in MN, the top LAC is Carleton. The flagship, U of MN, is a reasonable alternative, and in some cases better, than Carleton. If you are at, say, Williams or Amherst and your flagship is UMass Amherst there is a bigger disparity in quality/prestige, but again, it matters what faculty you are talking about. UMass CS is very good, for instance.
If you are a person who is quite social, wants lot of choices, doesn’t need a lot of hand holding, and is able to do well in large groups, then a State flagship can be just the thing. Small schools can be great, but also claustrophobic, particularly if they are out in the country.
One story…I have a relative who is a tenured Ivy league prof. He did his undergrad at a very ordinary State flagship(We’re not talking Michigan, or anything close to it). He excelled there, went on to a top grad school, and the rest is history.