That's a complicated question. Many things make a school or school district great; and while schools in Lake Oswego and West Linn have great reputations, there are certainly some things they cannot provide. However, assuming the schools you refer to have exactly everything you need and want for your student, and assuming no other school in the region can provide exactly the same things, then you have to make one more assumption: that there's no other house in the entire school attendance area, or the entire school district, that you would want or be happy with for a price you can afford, except next to the freeway.
If that latter assumption is correct, and if your number one priority in where you live is the education your student will get, and if you won't mind the traffic noise from the freeway, then choosing a home next to the freeway seems like the smart way to go.
It's true that location is a huge factor in real estate, but it's not the only factor. Another factor that's just as important is price. Any property will sell, regardless of location, at the right price. So that freeway-side home may take longer to sell, and will sell for a lower price than similar homes around it that are not next to the freeway. However, you also should pay less for that home initially. Everything is relative.
On the other hand, don't let anyone fool you. While home inventories are lower now than they were a year ago, there's no scarcity of homes. While prices have risen some this year compared to last year, prices are still incredibly low compared to where they were four years ago.
If education is your most important factor, and if you're willing to sacrifice every other aspect of your home to get that Lake Oswego education, then you probably have time to be patient, and wait for another affordable home to come on the market that's not next to the freeway.
I won't say that home prices will start going down again, but they may flatten out. Even if they continue to rise, it's not expected to be at a fast pace, and certainly not at the pace they rose in the 15+ years before the big crash in 2008.
As you go forward, however, the best thing you could do to choose the right home is to get the help of a trusted advisor. Get an experienced real estate broker who is smart, and whose integrity is beyond question.
Best of luck.