As someone who graduated from U of I, I can tell you Champaign-Urbana is pretty damned good as far as a college town. Remember it is only ~2 hours away from both Chicago and Indianapolis. As far as the kind of town Champaign is, you could do far worse for the size it is. Think about it, it has world class concert facilities (Krannert is as good as anything for bands of any type) including a large venue for big draws (Assembly Hall), great restaurants (Black Dog Smoke and Ale House, Blind Pig, Ko Fusion, etc.) not to mention the sheer number of girls there (it is extremely concentrated).
Really, it comes down to what you feel most comfortable with; if it's Chicago, that's great--I live in Chicago now, and it's the best city I've ever been in. You can't go wrong with either choice in my opinion.