After the year in halls.. your mum is right - london is more often than not extremely expensive. But if you shop around when looking for your 2nd year accommodation then there are places to be found probably from about £70 a week (possibly pushing it a bit - but if you look in places like camden there are some house shares to be found..).
You'll be more spread out from friends in the 2nd year most probably, but then again you'll be going to the union and out to similar places, plus meeting up centrally for lunch/whatever - so i don't think that keeping in touch with friends will really be too much of a problem (everyone will be in the same position, so everyone will be making the effort to meet up. My bf in london at the moment has friends living all over the place - croydon, bethnal green, hampstead, brixton, elephant & castle.. and he still manages to see everyone.)
Travel is most likely going to cost you a fair bit , even if , like me (in 2 weeks) you are going to be living really close to your campus - that'd be fine if all you do is go to your lectures, but in reality there's a lot more to london and with kings halls all over the place, as well as london generally being rather big it would PROBABLY be worth investing in a bus pass or travel card anyway - so what i'm saying is that the travel costs are most likely to be there anyway, regardless of whether you live really centrally or not - especially once the travel system is changed to fewer zones. Plus, it's the kind of thing that gets factored in to living in london and the comparatively larger loan.
Finally, london is a pretty amazing place to live, and going as a student is probably one of the best times to do it. In my opinion the benefits outweigh the costs.. especially considering that all of the major cities are getting much closer to london in terms of expenses (brighton is moreso i hear, plus they dont even get the larger loan to make it easier..)