We camped at the chip in 2011. We made camp at the south end of the campground the furthest we could get from the amphitheater. Made for a bit of a walk to make the concerts but was a LITTLE quieter when we wanted to get some sleep. We found after a couple of days of riding all day and partying and concerts at night we didn't have any trouble sleeping though. We had absolutely zero problems at the campground and made several new best friends. It was an absolute ball and something everyone should do at least once. We would do it again. Oh and the "real" privies are kept spotless.
And like most things there are some downsides. The roads are gravel or dirt and like Rossn said it is dusty, or muddy. Not a good environment for someone trying to keep their scoot spotless. Where we camped you had to ride a few hundred yards through a cow pasture (that too eventually turned into dirt, or mud). Not a great surface for someone skittish about handling their scoot. And unless you head out early to ride you have to wait through Sturgis traffic. As far as I could tell there wasn't an good time to get back through Sturgis to the Chip, at least not during daylight hours. And the out-house privies get plum rank.
So pros and cons. If you want stay at a place that has a lot going on and plenty to see and do it's a great place. If you more after a relaxing place to chill after seeing some of the most beautiful county imaginable, maybe not the place.
'09 Ultra Classic