There are other factors beyond "prestige" which people consider when choosing their university. These can include:
- Social side of university: Many people attend uni for the social aspect and some people prefer the social life at one uni over another. I know this doesnt seem important in getting a career, but if you are happy and enjoying uni, this makes it much easier to do well, which will help you get a job.
- Specific aspects of the degree: Some degrees at "lesser" unis have advantages over their prestige counterparts (i.e. education degrees at ND and ACU gives you greater access to the catholic education system, a UWS undergrad medical degree is quicker then the undergrad program at Usyd)
Fyi, ND was not my second choice (well Med was my first choice, but after that). I chose ND over MQ for law and I was prepared to select it over any university in the state. I carefully considered all the factors and I thought the uni was a far better fit for me. This factor to me outweighed any possible advantage of the "prestige factor". Now, I might have made a mistake, but personally, I dont see myself thinking in 20 or 30 years time "damn, should have tried for a more prestigous uni".
EDIT: I got that phrase from a unit of philosophy I did at uni.