Even tho I'm a former student here - I will let one of our current student bloggers reply to this in more detail...
The basics: you must live on campus your first three years. "On campus" is considered to be one of our res halls, the new apartment village, or a fraternity/soroity. Every first year student is required to live in a res hall - your choices here would be Ross Hall or Schwitzer Hall. Ross is co-ed and Schwitzer is all female (but don't worry, they are right down the street from one another!). Your sophomore year options are Ross or Schwitzer, Residential College (right acros the street from Ross Hall - a suite style res hall for upperclassmen, with a cafeteria inside), or a fraternity or soroity - if you participate in rush your freshman year and pledge a house. Then, your junior year you have all these options in addition to the new apartment village down by Hinkle Fieldhouse and the football field. Your senior year - you can move off-campus at that point, if you want, or take any of the above options. Make sense?
I lived in Ross Hall my first two years and loved it! Easy way to meet people and get involved. I lived off-campus my junior and senior year with two other guys (at the time, the on-campus requirement was only the first two years) but was still close enough that I was able to walk to class, which was nice. I had fun with this but did miss living "on campus" a bit.
Bottom line: you'll have lots of options for housng all four of your years - and I don't think any of those options are not desirable. Submit your housing information early and you'll be more likely to get your first preferences!
Cheers.