Although I disagree with his comment that the home school advantage is not a real thing (it is for sure), a lot of what you say here has more to do with the city than the school itself. People simply favour the city of Toronto over many other cities. It IS a world-class city, no doubt. But you imply here people pick U of T for some sort of prestige or superiority over other educational experiences. In my experience, having known dozens of people from my undergraduate program who made the decision between Toronto and other Ontario medical schools, it was typically for the city that people went to Toronto. Statistically, many people will be hailing from the GTA originally and want to reconnect with family and social circles. Many of these people who went to U of T didn't particularly even like the Toronto curriculum or the over-crowedness of the learning atmosphere but, again, picked it for geographical reasons. Toronto is Toronto -- if you are a big city person, no city in Canada can match it. With this in mind, it is really unfair to use the number of offers sent out by each school to compare U of T and Queen's for QUALITY when you are pitching Toronto against Kingston.
Aetherus makes good points that Queen's does have a recently revitalized curriculum and consistently boasts a match rate that is superior to more massive research centres like U of T and McMaster. Especially after U of T's basically record-setting abysmal match this year, this is true year after year. And Queen's does not necessarily send a large proportion of their class to family medicine either. Many of these matched people are Royal College bound specialists.
Another point you make is with regards to world class lecturers and hospitals, implying that by default this makes your learning better. This is a naive view. Toronto absolutely does offer this and as Canadians we should all be collectively proud of the accomplishments we've made as a whole from coast to coast, including those made at Toronto. But unless you are at the cutting edge of research in your field, the research accomplishments of your school do not necessarily translate into better learning experiences. McMaster also offers world-class renown researchers and clinicians, especially in internal medicine, some of whom are among the most cited researchers in the world (top 10-20 in the world for all-time citations). I did part of my clerkship with one such person, and to be honest, it was probably one of my most underwhelming learning experiences, and not because my learning expectations were high. This person was quite nice, but they were distant, absent and too specialized and often missed the big picture for a student. Although it was cool to say I've worked with them, the bulk of my learning and development as a physician is with the everyday clinicians. Clinicians who are dedicated to the teaching of medical students; they may not be the most seasoned researchers, or world experts, but I would take a teacher passionate about his students' learning over that any-day. You're in medical school to learn the the basics - and as someone else on this forum said, you can learn that just as effectively at Saskatchewan than you would at U of T or McMaster.
I make a point of addressing your arguments because I worry that people would read them and fall to the dogma, selecting a school like U of T for the wrong reasons and not having their expectations met. Don't get me wrong, there are plenty of good reasons to go to a school like Toronto, and if I had to select between most Ontario schools I would have gone to Toronto. But I do not believe the reasons you stated are those ones.