Well my situation is a little different, but yes I turned down Harvard because an unfunded MA, even from Harvard, is not worth the financial sacrifice, especially in times like these, when job offers are scarce and loan repayment invoices start coming in regularly once you've finished your program. I've seen enough, lived in enough places to realize that prestige of the institution is not the foremost determining factor in your career. Rather, it's what you do, and how good at it you are. Look at Cornell's comp. lit. program. This year they took the grand number of THREE applicants out out a pool of four-five hundred. That's ridiculous. And no one can guarantee that just because you were one of those three applicants, you would have better job prospects when you came out. In fact, most job offers right now are coming from two-year colleges who are looking for part timers. What they want is teaching experience and a solid educational foundation, they're not interested in how famous your school is or in what school of theory you've made your stake, but in how much training you've had and what your recommendations say. And the fact is that at a lot of these big-name schools you don't get much attention, especially as a MA student, because most of these MA programs are cash-cows for the department. They know you'll be in and out in two years max and the money is what they care about. You're not a long term investment or an asset to them, but a customer, which means you might not get a lot of one on one time. Do take a look at Dartmouth's placement list and where candidates have gone. And email a few people and ask how they like the program. I ended up choosing a state-school PhD program that would allow me to teach and design my own courses, take classes across a broad range of areas, and ensure that I received some personal attention so that I could get to know faculty members and get decent recs. for my dossier. (That becomes hugely important later on.)
I went to an Ivy as an undergrad and I know what the prestige of a place can do, as well as how horrible it can be to be stuck in a department that's considered top-three in the country, where the profs are super-stars who bicker among themselves and don't give a damn about their graduate students. A friend of mind is currently working with the best Auden scholar around but he's so busy with his conferences and his inflated ego that he never seems to find the time to review her work or help her form contacts. And then employers start to wonder: how come your dossier is so thin? There is this old Croatian proverb (I do comp.lit too, with English) that says: "better to be first man in the village than the idiot of the town". And these PhD programs you mention aren't even that bad! They're great in fact! It's a win-win situation. And I think you'd get to work with people who would really care about what you do and would help you perfect your skills and become a good prof. And that's what you want because in the end, it's yourself and your mind that are the most important thing in this business. We all study literature because we love it, knowing fully well what our earnings will be like. So if for once someone is extending a hand and saying -- look, I'm going to pay you to do what you like best, it's an amazing thing. Take advantage of that.