My mom's family lived in a small town (not her immediate family, her dad moved them around, he did construction) and she said she would never ever want to raise kids in a small town because "when there is nothing to do, they get in trouble" and indeed, her cousins and nieces and nephews did. She sent her niece Susan $500 at graduation for making it through without getting pregnant or arrested!

We did grow up in sort of a suburb but with a university, library, sports and dance places, buses to downtown, plenty of places to work and parks and stuff. I moved into the city proper, but not downtown. My kids thank me for not raising them on the outskirts. I do think more urban is better than suburbs and uptown like we are is ideal, a "development" from the 1940s a couple miles from downtown, not in the direction of the very rich people. There are both houses and apartments here and it's fine. There were where I grew up too.