Still thinking. Iwama is quite a small place, and quite far from both Mito and Tokyo (from memory). Not impossible from either location, but not something that I'd want to do on a regular basis. The only Japanese university I have studied at is in Nagoya and I don't think it would really suit your needs. Perhaps Peter Goldsbury has some ideas.
Iwama is actually quite close to Mito; only about 20 minutes on the train. I used to live within walking distance of Mito Station and could get to the dojo in less than 35 mins. It would be a little faster these days, since there is now an exit from Iwama Station on the dojo-side, so no need to walk all the way to the crossing. I have a friend who will study Japanese in Mito while training at the dojo next year.
Although it takes a couple of hours, some people do actually come from Tokyo to train in Iwama. Doshu and Waka-Sensei also make that journey regularly to teach.