Hello Helm737,
I would say about 60% commute, it is possible, but everybody needs to find out which way he/she likes it. Most people have/share a place nearby, also France, Germany, Belgium is possible. Germany for the time being is the cheapest deal, and only 25min to the Airport in LUX. If you register to be living there, you don't count as a commuter, so I would say there are actually even more commuters.
But to tell the truth, life is a lot easier if you live here. Trier, Saarbruecken or Cologne are nice places to be, and you also have SIM, Groundschool etc. in between, where commuting becomes a hassle.
Anyway, in your off days you can do whatever you like, so as I said b4, everyone has to find his luck for himself.
Cheers, WOB