Lastly, I would like to live and work in the mid-atlantic, actually more like Philly even though there's probably to much competition to land there from PSU. Realistically what placement look like from Penn state to Philly or the rest of PA, NJ, DC, MD
Just by researching scholarship retention rates you're already ahead of most 0Ls, and that's good.
If you really want to be in the Mid-Atlantic/Philly area, then I would definitely be looking at law schools out there. Chapman, Seattle, etc are not going to be very helpful with landing a job in Philly.
One question: have you ever lived back East? It's really, really different from CA. The winters suck. It's fun for about a week, and then digging your car out of snow and slogging through frozen mud loses it's charm. Seriously, this is something to consider if you're from OC. If you go to law school in PA, it will be difficult to return to CA.
Let's say you get a job in PA, then decide a couple of years later that you want to be around your family. This means that will have to take the CA bar and start looking for a job with no local experience. This may not seem like a big deal now, but it is. Really think this one through.
As far as Penn State's placement in Philly, I don't know. I would imagine that it's OK but not great. Philly is pretty well stocked with Temple, Penn, and Villanova students. Rutgers and Widener are not too far away. A large part of landing an internship and later a job is your own moxie. If you are a motivated go getter you'll probably be alright. If you're relying on your school's career services office and/or the school's name, you're going to be disappointed. I would check with PSU and see how many students end up interning and working in Philly.
If you're really sold on Philly, check out Drexel's scholarship retention rates and see what Temple offers. Being in Philly would be a huge bonus.
If you are open to other states like MD, NJ, DC etc, then I would apply to schools there, too. See what happens. Even if it means waiting a year, it may be worth it if you can score an awesome offer.