You'll need to tidy it up but it should work
WITH x AS
-- eliminate all duplicates,set up a counter for each distinct record
-- as well as flag for WI
(SELECT DISTINCT studentID, STATE, 1 AS cnt, CASE WHEN STATE = 'WI' THEN 1 ELSE 0 END WI
FROM DataTable)
SELECT studentID,
CASE
WHEN MAX(wi) = 0 THEN 'OUT' -- this student is not in WI at all
WHEN MAX(wi) = 1 AND SUM(cnt) > 1 THEN 'MULTI' -- this student is in WI as well as another state
WHEN MAX(wi) = 1 AND SUM(cnt) = 1 THEN 'IN' END AS Status -- this student is in WI and and no other state
FROM x GROUP BY studentID