<WARNING>Long rant follows on affirmative action. If you just want to stay on the topic, read the last two paragraphs.</WARNING>
The only problem is that AA doesn't even help the truly disadvantaged. In the case of minorities, the vast majority that benefit are middle/upper class individuals.
I think this is fairly true. I have no problem with cutting an applicant some slack on his or her MCAT if he goes to a community college because he can't afford tuition, but does well in school. I don't think grades and MCAT should matter all that much; as long as you are above a certain threshold that indicates the ability to learn and apply the material in life, that's good enough for me.
I have a couple problems with it though. One is that the admissions committees are likely to forget that AA is meant to reward those that are disadvantaged; being black or Hispanic doesn't make you inherently disadvantaged. One of my best friends is Hispanic, and he is at Harvard now. We did most of our extracurriculars together, and had nearly identical grades/SAT. However, when I had my interview, I was told point blank by my interviewer that my chances were slim because of the sheer volume of Asian male applicants just like me. Sure enough, I didn't get in. My friend certainly isn't disadvantaged (his parents pay his housing and tuition in full), but I know that his application stood out more because of his ethnicity. He had the same advantages that I had growing up. If the ADCOM is made up of (mainly) old white men, they may think that an average scoring URM is better than a low scoring URM, even if the average scoring URM had all the advantages of an Asian (over-represented minority perhaps?) or white applicant.
That brings me to my second point, that not being an URM makes it more difficult to stand out to the ADCOM. Most of my friends are Asian-American, thus I tend to compare myself to them. Until I started to look at other people's profiles online, I thought that I am just average: I'm as traditional as you get, 37R/3.9 GPA in bioengineering at Berkeley, with research/volunteering/work etc. I was rejected post-secondary at both UCSF, which I would have given anything to go to, and Stanford, my second choice. The problem I had was that I couldn't find a way to distinguish myself. I know they get tons of applicants who are just like me; if the ADCOM isn't actively looking to take more applicants of my background, my chances aren't good without something truly extraordinary. Maybe I am just an average applicant, and I'm starting to think too much of myself, but I'm sure that being Asian didn't help my cause.
Sorry for the length of the post. I guess it's just the frustration of not being able to stay where I want to stay (don't get me started on the California in-state applicant). On the topic of where to go, I really wouldn't pass up the chance to go to your dream school if it really is a dream. If money is a concern, you can probably get pretty low interest rate loans. The interest on a Stafford loan is almost nothing. It's 2.8% while you're in school, then up to about 4% after; the 2.8% is probably the inflation rate. Give me as much money as I want at 4% and I'll be rich. Debt doesn't matter if it's not really compounding. You can take your time paying it back. You can EASILY make back that 4% through investments.
But it really depends on how much you want to go. I love the Bay Area, have friends and family here, and nothing would have made me happier than to be able to stay here for the rest of my life, but that's me; I would pass up being paid to go to Harvard in favor of UCSF (but offer me a contract to be an MD now and I just might just pull a LeBron). If it doesn't make that much of a difference to you, take the money and go to UVa, but remember you only have one chance to follow this dream.