There's a difference between the legitimacy of the game and how the game is played. I think it's all BS, and I agree, I would personally go to the cheaper school. However, why do people still flock to the Ivy's? Harvard. Penn. Columbia? There's a reason for that don't you think? Do you really think they get better training? No. In fact, I think they get less of a clinical training because they are so obsessed with their prestige, name, and therefore are generally more research based. But again, this is two different things.
The game is, the prestige of the school matters in a lot of different form. Legitimacy of it? None, the way I see it. However, you can't automatically shoot down a school just because of a personal belief. Again, some choose prestige due to upbringing, different life goals, etc. Not everyone just wants to come out and be a practicing dentist.
Let's make an analogy. Why did Obama's birth certificate really matter? Does the fact that he is an American born citizen or not make him any better or worse of a president? Will it change what he has done in the past? No, but people still obsessed over it because it's the game. You play it. Does where you graduate from high school, undergrad, or dental school actually measure how good of a dentist you will be? Absolutely not... but guess what? People still kill and make tremendous sacrifices to get into the "best" high school, the "best" undergrad, and the "best" (most prestigious) dental school. If the majority of the people think it matters, then it's what is right, weather or not it is actually legitimate/"right" or not.
It's a screwed up game. And I agree with what you're saying in terms of practicality. But in reality, it's not as simple as "cheapest = go to that school."
In regards to what Msmouth is saying. Again, I completely agree with what you're saying. Most cases, patients won't care where you went to dental school. But not everyone wants to just open up a nice little practice and just see patients. Some people want to do politics, faculty, etc. That is where what your diploma says matters, weather it actually measures your ability to succeed or not (most likely not). THAT, is where prestige matters.