Portland is really the only major legal market in Oregon, and it's well served by many top schools, as well as Oregon, LC, and Willamette (do a Martindale search for Portland, last 5 years, and tally up the number of schools).
Of course UO won't be able to place a great portion of its students in a OR or WA firm, but that doesn't mean that people aren't finding jobs in smaller markets and/or smaller firms. It's a completely different world up here than it is back east. There are a lot of "other" legal jobs, including gov't work and public interest.
ETA: I just did a search. Total lawyers in Portland, > 5 years = 278. Martindale reports that of these 278:
58 - UO
5 - UW
41/24 - Lewis and Clark College / Northwestern School of Law
1/2 - Boalt Hall / University of California, Berkeley
33 - Willamette
And so on. Those schools do well enough.