I have to say what Gellert is saying is spot on. I've lived in Chapel Hill for about 7 years now, both in high school and through my undergrad. I have friends in grad school who live in Durham, but sometimes I see them a bit screwed by the commute. The bus (usually DATA/ Durham Area Transit Authority) is the one they use, and it costs $2 per ride unless you get a pass. But I have seen many a students miss a bus and have to hike back to the library (I work in the Music Library) to wait for another hour. They also have to time coming to campus pretty carefully. But it is definitely more affordable, and especially married couples tend to live out in Durham. Chapel Hill transit is really frequent. Gellert said something about MLK Blvd being an undergrad central, but I live up that way, and can say many many medical students also live up there. I lived here http://www.pointeatchapelhill.com/ for a while with my parents in high school, and there were many many grad students and families. I would say yeah it's pricier, but with roommates it might be better. It's also right on the T bus line which is pretty frequent. If you live near the NS line, it runs nearly every 15 minutes during class times! However, stay away from Chapel Ridge for sure if you don't want to be engulfed in the mob of undergrads there. Also stay away from Townhouse apartments on Hillsborough Street closer to campus. It is a dumb and loaded with hard-partying undergrads.
I also have friends who lived in the Glen Lennox (although, I think the university is taking it over) which is down Raleigh Road. One of these friends lives in a house with a few other girls, and pays something like $300 per month! Carrboro is also super affordable (and as Gellert said, FULL of hipsters). One friend pays around $250 a month to share a house with two housemates. I'm not sure what utilities are, but having lived in New Hampshire for 15 years, I can say the winter is WAY more affordable than up North!
Also, from an earlier post, food wise, Cosmic Cantina has the BEST and most affordable burritos! Also tasty is Kurama Sushi Bar, and I've gotten out of there full and happy for under $5! Lunch on campus is not the cheapest, but there are alternatives, like Alpine Bagel in the student union, and the Hunger Lunch ($4 for rice, beans, and cornbread) every Wednesday. The only other food thing I want to mention is Mediterranean Deli, as mentioned above for vegan food. I LOVE this place, but my vegan boss freaked a leak when she found out they cook the meat on the same stove top as the vegan food. So if you are THAT particular- just a heads up. Otherwise, this is one of the best places around... once you join the club in learning how to order you meal (not so easy your first time). And right across from MedDel is CD Alley, an awesome little independent record store. The people working there are wonderful and you can find used cd's and records sometimes for $1!
Ok- I'm rambling here, but there are so many things to talk about in Chapel Hill!