We live in Valpo and moved out here 7 (almost 8) years ago (from Illinois) for the same reason - better schools, better housing w/ lower taxes - and we haven't been disappointed.
My kids are in Valpo schools and I'm thrilled with their education and the opportunities they have.
You will definitely hear the "Valpo schools #1" mantra - but, in my honest opinion, your kids will get a great education in the Duneland school system as well.
My kids aren't athletes so what I know about the sports program is limited, but I will say that every time our kids go to a Valpo vs. Chesterton game (no matter what the sport), I always hear that Valpo won.
For ease of commute to Chgo, Chesterton (or at least the north side of Valpo) is best ... even with off peak times.
If you have any other questions, please feel free to ask!