Your sister sounds like a very wise person

I can't agree enough. Hard work and effort go way further than schools, teachers and people who surround you.
However on your point of being surrounded by intelligent people, I'd have to agree that it certainly makes you want to work harder in a competitive environment. Me as an example, I was beginning to become very complacent in my old school as I did not have to work as hard to do well. However, going into a selective school really opens you up to what kind of kids you up against, and this has definitely made me work harder. That being said, this only works for some people. While people like me may thrive in competition, others crumble. And that's totally fine, these schools aren't for everyone.
Also on your point of not getting into JAC, it really isn't a big deal. Hard work by yourself is much better than forced work by a tutor. You still have plenty of time left, make sure to look at some other resources on this forum and ask questions if need be. There are some excellent people on this forum that will always be willing to help you.
I hope you do well and wish you luck in getting into the school of your choice. You can definitely do it