I don't think there are any advantages to dorms, except for free repairs. I had to pay for maid service when I used it in a dorm. Meals at the commons are free for all students who attend that university, whether they live in the dorm or not.
Bills for a large house should be considerably cheaper than paying for 8 students to live in a dorm and your sims won't get kicked out when they graduate. You can make changes to the house whenever you want without needing cheats or mods. You can access things from your household inventory, such as date rewards and holiday gifts. All in all, I think Residential will be a better choice for you than University Housing.