My 2 cents:
1. To directly answer your question, most working musicians these days are in Los Angeles, Nashville, New York, maybe a few others. If you want to be like them, go somewhere where you can study with them.
2. College is very expensive and will leave you with a ton of debt. Be smart about why you are going into debt - study something that will pay off like business, marketing, etc.
3. Unless you are going to be a music teacher in a school, NOBODY cares about someone having a music degree or not. A pro musician gets hired based on who he knows and how he plays. If you want to do it to be a better-rounded musician, that's cool, but don't expect that the degree will help you get work.
4. College doesn't have to be THAT expensive. Go to your local community college first to get most of your general ed courses out of the way, and then transfer to a 4-year university. You can study performance and theory there too, and your music teachers can help guide you towards a school that is good for what you want to do.
5. When you're ready to transfer, do not overlook state colleges and universities. They are much cheaper and often the same teachers teach at several schools in the same area.