Where did OP said her/his daughter could likely only make her sports team at a not-large school? I didn’t read OP’s responses that way – but in any case, I agree with you twoinanddone that the fit is likely better at a smaller school if that is a major consideration.
My own D started out the same way as OP’s daughter, wanting that “sweet spot” medium-sized populated school. She just didn’t find very many out there at all, much less with the right combination of academics, sports, social activities, campus feel, etc. So given the choice, in that scenario (because my D did want to play on a team, for a school with highly rated academics), the smaller school made sense.
And, as always, it’s all about fit.