South Bend kind of blows and Iowa City is very meh.
You have to look at the actual school IU is competing with. Their immediate goal is to improve amongst public schools Big Ten schools. IU isn't in direct competition with BC or GW, because those schools cater to different types people: East Coast versus Midwest, big city versus college town, high COL versus low COL, public versus private etc...
Indiana is trying to pass up Illinois, Iowa, Wisconsin and Minnesota because those are the schools that will steal away Indiana targets. Those schools are trying to maintain their status while also improve further. If you don't think Illinois is worried about being passed by Indiana, you're mistaken. Even if Indiana isn't stealing away Illinois's best students, they are likely taking previous Illinois admits who would've paid full or close to full tuition. That means less and less money in Illinois's coffers to give to their top targets.
Very true. Competition in the 20's and 30's adds some regional flavor to the competition. The top 18ish compete with each other for top applicants--the applicants choose what schools will get them the top jobs and for the best bang for the buck. Where the school is is not as important (important note: I'm not saying it isn't important. Somebody who wants to work in Cali probably would pick Berkeley over NYU if given the opportunity. However, if I want to work in New York City I'm not necessarily picking NYU sticker over Michigan for a bit of scholly, because Michigan can place there plenty fine).
When you get down in the T20 and T30, people have to choose a region they want to work in as well, because the schools have a harder and harder time placing employment the lower you go down the rankings. Obviously, in the T20 and T30 they still place okay
outside of their market, but you get the point. Where a school way down in the rankings only has a decent placement in the direct vicinity of the law school, a school in the T20-30 has a decent placement in a tri-state area, region, whatever.
Simply put: Indiana isn't really competing with Emory for applicants, because many of the applicants for those schools chose them for the region. I personally didn't care about the region, but it can't be denied it's an important factor for those schools.
For what it's worth: I was offered a full scholly from Illinois and Indiana, and I consider the two to be peer schools. If I choose a school with a full ride, it will be a tough decision between the two (unless Vandy or USC makes me a lucky, lucky man