Michigan is also ranked #4 for undergraduate business, another popular program these days.
It’s true that Michigan gets very few students from Wisconsin. My daughter saw it differently. I encouraged her to apply to UW-Madison where as a Minnesota resident she’d pay in-state tuition due to tuition reciprocity, but she had no interest. Michigan, on the other hand, was pretty high on her list. She thought there was a real difference in academic quality. That’s hard to measure, of course, but Michigan does have more top 5 and top 10 programs; that said, Wisconsin is no slouch in that regard. Most obvious difference is entering class stats where Michigan clearly has the edge.
I don’t think many drive from the East Coast—they think it’s too far, even though the driving time from DC to Ann Arbor is about the same as from some parts of Michigan. But Ann Arbor is conveniently located 20 minutes from Detroit Metro Airport with non-stop flights to pretty much every major market in the country—makes a big difference if you’re trying to get home and back for Thanksgiving. And while Michigan does draw many students from the Northeast, it draws roughly as many from California as from New York, with Illinois a strong third.