I live in a town of almost 1200 people. I grew up here and stayed here. Our school district is consolidated with 4 other towns, prior to that the towns were each consolidated with another, so 2 districts. Each town has it's own elementary and middle school is in one of the "larger towns" and high school in our town. We may not have all the opportunities of the larger towns, but I think they are sufficient.
As far as shopping, It really depends on your area. For us it's a quick 15-20 minutes to the closest town with Wal-mart. The closest decent mall is 40 minutes. We are circled by larger towns with shopping and jobs. We have a small 6 aisle grocery store, a library, hardware store, drug store, bakery, dentist, post office, hair salons, bank, 2 restaurants, a convenience store/gas station, repair shops, etc. I do think that some of them struggle, but some of them do really well. It most likely depends on the business.
The MSP airport is probably 1 1/2 hours away, 2 hours max.
As far as people being "friendly" another poster was correct in saying that everyone knows your business, but in the same respect they are there to support you in the bad times too.
I was just speaking with my nieghbor who moved here probably less than 10 years ago about the friendliness of people. She said it's hard to get accepted, but I also think that you have to take some responsibility and get involved, not sit back and wait for people to knock on your door. We also decided that a lot of the people she was trying to get "in" with were people with high school age kids, that have grown up together. Most likely finding your niche in the town will be surrounded by the parents of your kids, and those that have the same interests as you.
Good luck in whatever you decide to do...