For me this was a really hard choice that became a lot easier when i got into my state school (IE instate tuition)
I've had amazing experiences with DO's and MD's, but I've always felt I related to the DO physicians and students I know a little better than the MD's. To this end I had planned on going to a DO school (in fact my state MD school was the only MD school I applied to). However, I would have been either an out of state student at a public DO school or a student at a private DO school. The difference in tution between my state school and the DO schools is so great that I just couldn't say no to the MD program.
As a DO student, the basic science education you get will be equal to MD students. You'll have the opportunities to do the same rotations as MD students and you can apply for the same residencies. As a DO it's a little harder to match into ultracompetative specialites, but other than that there just isn't much difference.
There are a lot of valid reasons to choose one school over another (MD or DO). Geography, cost, research (if that's your thing), class size, opinions of current students, etc, etc, etc.
The bottom line is to figure out what is important to you in a med school and then go from there.
As for why premeds all pretty much start out as pre-MD students, I'd say a lot of that has to do with exposure to DO's. There aren't a ton of them out there (although there are getting to be more). In fact, most of the population doesn't know what a DO is. There is some stigma involved with the DO degree, but from my limited experience this stigma is almost entirely a premed thing.
Good luck,
s