As you mentioned, by your estimation, both schools are good. So it's really a question of your comfort level (do you feel you will definitely learn better from the more expensive school?) and your own finances.
The right instruction and the right type of instructor for you can have you learn things almost ten times faster than poor instruction or bad fits between instructors/students.
However, you usually have to have some significant experience with martial arts in general to pick up how well you're going to learn from someone and whether they're giving you key insights or dragging it along.
Here's some factors that you should consider to that might help you figure it out:
More students? Better network of training partners?
If one school has a lot more students, you might be able to train more often, and take advantage of more body types and personal styles to train with. McDojos can draw a LOT of students and give you that opportunity. However, the other half is you want people who are interested enough to train/practice outside of class, and that could go either way depending on the schools.
Wing Chun Dummy
If we're just looking at the testing price differences you're listing, you can buy your own wing chun dummy at what you'll be saving at the traditional school. That said, you learn more live-movement skills against actual partners, and the dummy is better for developing power and conditioning when you don't have partners.
What you SHOULD look out for from the Traditional School
The smallness of the traditional school shouldn't be a concern - Wing Chun is a close range fighting style anyway. The summer I took Wing Chun there was a tiny room in the back of a store in Chinatown we trained in. So, that's not really an issue.
The thing to watch out for with some traditional schools is that (unfortunately) some will be very abusive and cult-like. This can happen in McDojos too, but usually the money incentive limits how far the asshole behavior can go, while the traditional schools fall back on the worst parts of Chinese traditions to excuse every bad behavior. The school you were looking into might be completely like this, or not at all, but that would be the thing I'd be watching out for.
What you SHOULD look out for in the "modern" school
It's one thing to have a progression track - that makes sense and is a key part of a lot of athletic training in sports in general - but it also can be a key point of salesmanship.
The question is, how do they test your actual skill at each level? Is it just "do the form" "break some boards" "punch 1000 times"? Or, do you have to get into some serious sparring?
The trick to the McDojo is they sell you on the reassurance you will get X skill over Y time and Z dollars spent, and never actually put you in tests that genuinely test your skill, so you never realize your time (and money) has been wasted. They're very good at appearing organized, having a simple to understand "program" you follow, and it seems like it's going to be very easy to learn, and what you learn, IS easy to learn, it just might not be anything useful.
You may want to check out their sparring or watch some video if they do tournaments.
(This is not to say there aren't traditional schools with this same hustle, however, the modern schools are good at the X skill/Y time/Z dollars marketing, whereas the traditional schools sell more on "Just show up and train and be part of this select brotherhood".)