I guess it depends on how you feel about commuting. Personally, you'd have to pay be a sheetload of money to get me to drive 2 hours a day vs. zero hours a day.
How much more money is the new job? At $0.50/mile (2010 IRS guideline) that is going to cost you....what ~$50/day (assuming you average 50mph. Could be $70/day at 70mph average) plus more meals eating out perhaps over eating at home. So I'm guessing your break-even is around $14K-$20K per year for a commute like that.
So subtract $14K-$20K from the new job offer and that is the real "raise" you will be getting.
I wouldn't worry too much about the reputation thing if you choose not to accept the job you accepted. Business is a full-contact sport and they know that.
A man's gotta do what a man's gotta do
