I was part of the youth group activity day of all the local masjids in our area as a "youth leader" and this was a big topic there. The speakers made it seem that everyone should send their kids to only Islamic school and if they don't theres something wrong with them.
The upside is yes the kid will be around people that look like them more but won't have the exposure to the outside world as much I think. But when they go to college they're overwhelmed with what they see. For younger kids it may be better to put them in Islamic school to build a good foundation and later switch to public school. Personally I went to public school but Sunday school also. There was no full time Islamic school until later on. Like others pointed out family matters A LOT. My family grounded me well and always made me god-conscious growing up.They always said that even in their absence Allah is watching me and my actions and that had a tremendous impact on me.