My middle son departs for college next week. He is a super high achieving student (similar to you and your eldest daughter - straight A's, lots of AP classes, perfect score on the ACT, tons of extracurriculars/volunteer work) who shocked everyone (including us) when he opted to only apply to a very small state school with an acceptance rate around 80%. He was competitive for many "reach" schools, but just didn't want that to be his college experience.
It was hard to step back and let him make this very important adult decision as I really wanted him to at least apply to some reach schools, but I knew he needed my support more than pressure. This whole process is tough on students and their parents. I wish you luck!