I am close to someone who went undergrad at Penn State followed by Phd in ChemE at Georgia Tech. This guy was 2nd in his engineering class at Penn State, and regardless, he had the absolute worst time at Tech because his advising professor was a fraud. His professor had no idea what he was doing and was in research at Tech through connections only. The university was not very supportive of the numerous complaints that this student and his colleagues filed, which ranged from personality complaints to safety complaints in the lab to an international trip to present data at a meeting wherein the professor planned to share a bed with a student to save money. This student survived, got his PhD, and entered industry where he is making a lot of money researching things I do not understand for a petroleum company. His other complaints about Tech were that most of his peers were international, non-English speaking students who openly talked and cheated during exams and made terrible labmates.

I don't know about the PhD at PSU. I did my undergrad at Penn State (liberal arts, although I had a lot of PhD friends in computer science) and had a great experience with supportive faculty and lots of awards and scholarship money. There is a bubble effect at Penn State; it's a beautiful campus in the middle of nowhere. There's not much to do but do your work and then go binge drink at a house party. That's a big difference from life in the city, so factor the environment into your choice.

I think you need to look closely at the faculty of both programs. Both schools have great history and reputations. It's the faculty that's going to make the difference.