<p>I think the OP asks an excellent question. The schools ranked higher than Princeton are all outstanding research institutions with a wider range of engineering opportunities in almost every field and subfield imaginable. Princeton is a smaller engineering school with both outstanding faculty and students. They tend to have a little more of a theoretical bent because they CAN. The Princeton endowment is so huge that a theoretician can do really well there without fear of losing funding. Almost all of the Princeton engineering students I have ever met who actually went into engineering have gone on to graduate school and have been fantastically prepared for it. </p>
<p>If you can get into Princeton, I don't think you need to worry about where it is in the rankings. You may not get as many recruiters coming to Princeton because of the size of its engineering program, but if you want a job with just a BS and submit your resume almost anywhere, you will surely get noticed. I can't imagine a resume coming across my desk and thinking "no thanks, he only went to Princeton" LOL! You will also get noticed by any grad school you apply to. </p>
<p>In other words, I don't think it's a mistake to choose Princeton over somewhere higher ranked, but it's may not be a mistake to choose a higher ranked school over Princeton. Each school is a different experience and you need to decide which experience YOU want.</p>