Hey guys, I thought I'd jump in since I've got a buddy who is a current student at LBJ, and I attended the prospective student open house back in November. Obviously my perspective is still very anecdotal since I'm not a student there, and once people attend they have a vested interest in promoting their program. However, my friend did intern in DC, and he said that there was both a strong UT presence in DC and that he interned with grad students from all over the country. His perspective was that he had the same opportunities (presumably, since they were interning the same place) as other students who were paying more for their MPP's.
From the Open House in November, I was very impressed with Dean Hutchings and his vision of growing LBJ's footprint in Washington. It sounds like one of his big priorities is growing the internship opportunties for LBJ students in Washington. They already have a program where students can intern in Washington while taking classes. I believe UT also helps out in some regard with housing (I don't remember the particulars). He seems to want to keep growing this program.
lacanadiense: I totally hear you about only 19% of students ending up in Washington (and the significant portion of students who remain in Texas). I suppose it makes sense that it will be at least a little harder to break into the DC scene if you're all the way out in Texas. On the other hand, I've consistently heard from various sources that UT does have a strong alumni base in DC and that they are a helpful resource. It sound like coming from Austin will take more work, but that it is doable.