I go the University of Iowa and I will admit that Panchero's, conveniently located on Clinton Street, is very popular with students. When I say popular too, I don't mean only late at night when its clientale ranges from slightly inebriated to completely [--]. (To be absolutely fair, Pancheros at midnight on Saturday is actually so interesting it is almost worth the visit.) Many students and locals have a genuine affection for this place and it gets fairly busy at lunch and etc.
Why is Pancheros popular? I have no idea. Pancheros is based around the idea that you go through this middle school cafeteria type buffet line and pick out ingredients you want to add to your burrito. All the while of course, they (over)charge you for each thing you choose to put in your burrito. Even though I generally don't like buying foods at a restaurant that I could easily make at home, the probelm with Pancheros is not so much the concept as the fact that the ingredients don't taste that great and its overpriced. Its that simple.
In the last year or so, I have noticed the rising popularity of Taco Bell in the Ped Mall for the last night student crowd vs. Panchero's. No doubt, this is because of price and quality. A subpar mediocore burrito at Panchero's can easily run you $9, while whatever you get at Taco Bell will likely be around half that. In other words, you can get a Grande Nacho Combo Meal (or whatever) and have enough money left over for a couple of beers- or you can get one medicore burrito at Panchero's.
Different strokes for different folks, I guess.