When I was looking where to apply, my husband and I sat down with the map and crossed off all the states we absolutely refused to live in. Then I looked at schools in the areas that were left (and there were plenty). We looked at school districts, housing, job prospects for my husband... all the variables we could possibly see without actually living there. I started ranking schools, he started ranking areas.
When it all came down to it, I turned down several interviews that were lower on the family life scale than a school I was accepted to. I turned down a school that I absolutely HATED but my husband would have loved to live around. And we ended up somewhere that I liked and that they liked. There were pros and cons to everything - but we agreed that if one of us just HATED either the area or the school, it was off the list. Period. In my mind, the family aspect weighed in to my opinion of the school... and where I ended up was ultimately one of the top two on my list.
I agree with Scottish - my family's happiness was VERY important to me. Fortunately, my happiness is important to them too, and we made a great compromise.