You can be excused from serving due to financial hardship if your work doesn't pay you for that time and you can't afford to take the hit (most people can't). You are correct that it isn't a fair representation because of this.

There may be scholarships available, but they would almost certainly be limited and for specific programs. Most international students are going to pay a lot to go to an American University. The costs of Penn State are here:

https://admissions.psu.edu/costs-aid/tuition/

You pay the same for room and meals as any other student. The reason tuition is higher for international students is that funding for state colleges come from taxes and you're not getting the benefit of having your tuition subsidized as a non-citizen. This is the same reason that out-of-state students pay more than residents. If your family didn't pay into the system, you don't benefit from those systems.

Most students work to pay for school by working part-time or doing work study programs (which may not be available to you as a non-resident, but you'd have to check). Many can't work enough to pay 100% of the tuition and take out student loans or get help from their parents.

You need to contact Penn State and ask them about visa sponsorship. They almost certainly have a process for getting student visas together for international students (as most colleges and universities do). You can also ask them about special programs in regards to financing and education with them, but I wouldn't count on there being any.

The town of State College is probably more expensive than other parts of PA, but PA in general isn't as expensive as some other states (e.g., CA). College campuses tend to be pretty safe, and things aren't nearly as dangerous in the U.S. as people might think, but you do have to be careful not to be running around in dangerous areas or late at night in situations which are risky (e.g., don't get drunk and wander around parking lots at midnight).

In terms of other states, you can look at the list of universities which are in this article that are much more economical than Penn State (which costs $40,000 a year for international students as compared to Brigham Young University in Utah which is $14,000).

https://www.mastersportal.com/articles/2269/these-us-universities-are-unbelievably-affordable-for-international-students.html

That being said, there are far cheaper state universities in PA which you can go to if you want to go to PA for certain. For example, Clarion University of PA is $16,000 a year for tuition for international students (https://www.clarion.edu/international-programs/Undergraduate%20costs%202022-2023.pdf), but it lacks the prestige of Penn State. Whether or not that matters depends on your reason for getting a degree and what major you're going to pursue.