No Debt MBA

I work at an agency that, among other things, helps out corporate professionals in recruitment and talent management. I had written a very long reply but that kind of compromised my identity, you see it's a ridiculously small world and I like to keep working in this industry. Instead of writing a long and complete email, you're getting the abridged version. Sorry, but I like the job security.

You are correct about the inefficient nature of campus recruitment, but it is effective as a means to get to know new talent. It is expensive, but more predictable than its alternatives, and in many ways potentially cheaper than a botched advertising campaign to get CV's sent in, or worse, a successfully one with all the ancillary costs of managing the onslaught of applications either via a system or members of staff. Can you imagine the budget these people have to snatch away fresh talent before the competition gets to them and indoctrinates them with an intense and rigorous traineeship/induction programme? 200 bucks to meet a Harvard/Oxford/Cambridge grad and see whether they're the right stuff is a steal. The salaries designed to keep a hold on the best performers are insane, don't imagine the amounts of money spent to get them to be any less enticing.

Yes, you are correct about figuring that word of mouth, aka referral recruitment, is more efficient. But as you noticed it is hard to scale that up to the gargantuan scale of an Exxon or a Microsoft. There are designs to make this process work though such as developing a reward programme but still has its ups and downs. One massive downside is that you can't controll what your "ambassador" is telling the prospective employee. Then again, you can't forbid employees to tell other's it's horrible to work for you anyway so the truth will come out anyway. I've heard it claimed that referral worked wonders for some, but I think you can imagine that the thought of institutionalizing the grapevine as a recruitment channel has left many corporate professionals unwilling to pitch this to his boss. Especially if said superior is often not used to an era where he can no longer control what is being said about him (online). Reputation-issues can scare off high level management pretty fast if you're in the wrong kind of company for that kind of thing.

This nicely moves us to your other question: what's a decent way to figure out whether employer X is the right one for you. This is essentially part of my business, but we're not (yet) in the States so the next best thing is a combination of:
1: research (try glassdoor.com and be amazed at the amount of reviews from employees)
2: knowing yourself (if you have some experience with office life this should give you a sense of direction as you contrast descriptions on Glassdoor against your own experiences
3: having a healthy amount of distrust for the source of the information. Aside from the random good samaritan and the bored consultant writing blog comments, most have an agenda. Be it getting back at a previous employer, trying to undermine the ratings of competitors or getting you to accept the job they're offering you. Just for the heck of it, assume they're all lying pieces of, well... you know.

Figuring out who to work for is what keeps many students up at night. It took me years to figure out what to do and I still have changes of heart. Just make a shortlist and start your research. Or just try something, it sounds like you're able to do a decent post-mortem on an internship and when it comes down to it.... it's just an internship.

(and yes, the email was longer than this)
(and no, I'm not affiliated to Glassdoor, I just think their concept is good)

I now work as a teacher. No recruiting! Internships are great to find out a lot about the company without committing yourself in a full blown career. Ask a lot of questions, particularly scenarios which will not receive a canned response. Work them harder than they work you.