I've been gone for a while, so below are some catch-up responses:
I can only speak to my firm really, but we do not discriminate against older students. You may hear stories that some firms favor young summer associates (read: under 35) because they will be less reluctant to do document review in their early years. I've had young associates and old associates work for me, and the truth of the matter is, if someone doesn't want to do the project assigned, they won't be around for very long regardless of their age. I personally don't care how old you are as long as you're smart and willing to work. You can usually tell who is eager and who is not within the first ten to fifteen minutes of working with a new associate.
The twin cities may not be Chicago or some large coastal market, but we have some very good companies to work for. If you don't end up in biglaw, you can make the move in-house, either as an attorney or as a compliance specialist. There are many employers in the cities that hire law graduates every year. I don't think anyone should limit their employment focus to merely large law firms. [FYI: I've said this before, but there are really no firms in Minnesota that would be considered "BigLaw", so when I read people who use that term, I read it to mean the larger two or three firms in the state.]
Regarding US News:
We don't typically talk about the US News rankings of law schools. You'll notice very quickly after you graduate that lawyers care much less about law school rankings than law students. My understanding of the UST situation with US News was not that UST lied, but that there was a clerical error that UST corrected. US News, per their policy, removed the school from the rankings for that current year. It wasn't really a scandal as someone previously posted, but an odd policy by the magazine. Regardless, UST and WM are typically ranked in the third tier and that is how we see them (note that this is true for WM even in the years that WM falls to the fourth tier). Neither is really held to be better than the other, even when one is ranked significantly higher, like UST was a year or two ago, or WM a few years before that.
From a biglaw hiring perspective, we do not discriminate against transfer students. Different schools have different systems in place, so you'll want to make sure that transfer students are treated fairly by the law school you attend. Most law firms will treat transfer students exactly what they are: law students who did very well in their first year. This is what we are looking for. If you do attend a school that appears to favor non-transfers, you'll want to take the initiative to get your resume in front of the hiring personnel. Do not rely on career services.