Where someone lives is a compromise. Everyone wants the best of ALL words: the dense urban area with a subway entrance on the same street, plenty of shopping and other entertainment. They also want a ski lift up a mountain, finish your day ski day in your own backyard, and a tropical beach in the front yard, among the other benefits of rural living. That is physically impossible no matter how much money you have, so you make the best of what you can get even though it cannot be perfect.
With the current situation of the US subrubs are the best compromise, but as things change different compromises become better. Right now dense areas are a lot more expensive for a lot less space, and often that space comes with the problems of living in a very old building.
Note that change will not happen overnight. Even if 30000 square foot apartments (intentionally be absurdly large to make the point) in neighborhoods with good schools was free it would take a lot of time for people to move even though the rent savings would allow for more than enough other lifestyle changes as to make it a better compromise for most people.