Hawaii's fixation on "where you wen grad" is indeed complex.  The other day, a friend and I were discussing whether she ought to send her kid to a private school - her child had been accepted at both Punahou and Iolani - or a public one.  My husband and I are both Punahou graduates, but our children attend public school: both by their choice and ours.
Ultimately, I no longer take offense at the "where you wen grad" question.  (For the record, once I started working in Hawaii, I'd tell people I attended a place near UH.)  If you think about it, it's a pretty good all-around statement of what you and this person may have in common: age, geography, beliefs, common friends.
As far as what I told my friend about what I would choose for my child, if her child wanted to go to Punahou (which she did), that's where she should go.  As long as you don't choose Punahou like a Gucci bag or designer clothes,  it's a great school.  As long as they leave with critical thinking skills, all is well.