Best Chinese language school?

That is a lot of questions to answer.

City
You would need to let us know a bit more about what you are looking for to make specific recommendations. Overall, the most logical place to go to learn Mandarin is Northeastern China as that is where standard Putonghua (Mandarin) is spoken. Cities like Shanghai, Chengdu, Guangzhou are fun but probably more suitable for traveling than learning Putonghua as the local accents there are very different.

School / University
Universities in China are state run. That means big classes, a lot of bureaucracy and in many cases not very motivated teachers, but also very low prices and reliability. For private schools, you have everything from outright scams to very good schools so you would have to do a bit more research. Another important part is flexibility though, most universities usually only offer semester courses, so if you only want to go for a month a private school is probably your only option.
For specific recommendations, I went to LTL <snip>twice, two years ago in Beijing and last year again in Chengde and can recommend them as a reliable and well organized school with good teachers.

Living with a family
I lived with a Chinese homestay family organized by my school during both my stays and enjoyed it. As with any family though you need to be willing to adapt to family life and routines. In both cases I had my own key and staying out late was no problem, but my homestay mom expected me to let her know if I would not come home for dinner. If you are looking for a very free, drinking themed experienced then this might not be the right choice. From a Chinese language learning point of view a homestay is for sure the best option out there though as you practice what you learned in class after school.
Also, most Chinese moms are amazing cooks.

A course before coming to China
I studied Mandarin on and off for two years before going to China and I enjoyed doing it so I do not regret it. Once I got to China though I realized I had learned very little considering how many hours I had put into it and noticed that I progressed much faster once I was forced to use what I learned. Also in my experience it made a difference to have a trained and professional Chinese teacher in Beijing rather than my self-taught Chinese teacher at home. I ended up basically in a beginner class so if you enjoy learning Chinese I would say go for it even before you come to China but if your main aim is to learn the language than you may as well save your time and money until you are in China and use more of it there.

Enjoy your trip, I think it is a great idea to learn some Mandarin before traveling in China. It makes the experience a lot richer and interesting when you are able to at least have some basic forms of communication with people as pretty much nobody outside Shanghai and Beijing speaks English. It is also a fascinating language to learn, I will go back next year for another month, maybe see you there.
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