i think there is an advantage to to be there in person, just because you can be personable etc and get a feel for the facilities and the "feel" of the school, but they certainly won't knock you for having something like distance/cost cause you to choose the skype option.
Of course this is my first year applying to graduate programs so I can't speak from personal experience, but my mom is on a board for a masters program at Stanford, and she has done several skype interviews for the exact same reasons you stated.