I think the view of Rutgers being the epitome of a "suitcase college" was true 15+ years ago. Certainly it was while I attended undergrad there in the late '90's - early '00's. However, many I have spoke with who work on campus say things have changed over the past 10 years. One is just a sign of the times. Kids are so into their smart phones, have Twitter, Snapchat, etc. and don't need to go home to see friends and family as often. Kids are just more "stationary" in general so to speak or more willing to take the path of least resistance (aka stay at school rather than incur travel time/gas money). The second is the addition of more things to do on campus. For instance, while I was there Livingston Campus was a barren wasteland except for the RAC. I hated when I had classes there. Now you drive over there and they have retail stores and chains like Chipotle, a movie theater and supposedly a state of the art dining complex. College Ave has also significantly upped their game with the addition of the apartment complex where the grease trucks were which also includes popular chains on the ground floor. There are certainly more things than just the College Ave student center and Au Bon Pain. These things may seem silly/trivial to adults but trust me they don't to teenagers. Also now you factor in that they are in the Big Ten and even though they aren't good on the field the names of the schools coming in to play will keep kids there to party and tailgate in the fall. You don't need to win on the field to party in the lots.
On a side note. A few years ago I went into the education field and I see more high school kids wearing Rutgers gear than I had when I was in school 20 years ago. Also believe it or not, kids are dying to get into RU. I've had students tell me they were upset that they couldn't get in. One girl I coached this year was crushed that she got into Rutgers and couldn't afford to attend. Another state school (Stockton) offered her more in grants/aid and she wisely opted to go there instead. And this kid is as bright and talented as any (she also got into Penn State and Maryland), she just didn't want to incur that much debt. I was also shocked to learn how much RU now costs per year for in-state students which is a travesty.
I will be the first to say that Rutgers is not the campus experience that you get at Ann Arbor or in Madison or even State College, PA (puke). And it certainly isn't what you get at a southern school like Florida State, North Carolina, Georgia, etc which is a totally different world than the north when it comes to college campus life. But I don't think the suitcase college moniker or comparing RU to the K-mart of college experiences is accurate any longer. I work with high school students every day and I can tell you there is a much different perception of the school now than there was when I was in school. And they are the perspective clientele so I take what they have to say more seriously than some old guys on a message board who obviously have little respect for the institution lol. So your sweeping generalization that "no one in NJ wants to go to Rutgers if they can avoid it" is patently false. There are 9 million people in the state...a lot more than the people you may know/who you've talked to.