My elementary school's motto is LWE:Leading the Way toward Excellence.
 I asked the vice principal why not Leading the Way to Excellence, but
she said that "to" wouldn't work in this situation... it had to be
"toward."  Is she right?  If so, why?

Personally, I think "to" sounds better than "toward" in this motto. A
slogan has more punch when it is simple and direct.

If you think Excellence is a destination and when you get there, you
will stop, then "to" is appropriate.  If you think you are going in
the direction of Excellence, but because you can always do better, you
will never actually get there, then "toward" is more appropriate. 
Probably the vice principal considered the second description of the
journey more fitting and so preferred "toward."

"to" implies that you can get there or achieve the goal you're heading
to.  It makes sense for attributes that one can clearly determined
such as: Leading the Way to Literacy, Leading the way to cleaner air. 
You can say if someone is literate or if the air is cleaner.

"toward" does not have that implication, it just implied that your
headed in a particular direction and it may not be clear when you get
there:  Leading the way toward clean air, Leading the way toward real
social change.  It's not clear whan the air will be clean or when
you'll have real social change, but that's the general direction
you're heading.

In your case, Excellence is not something that you achieve or at least
it's not clear when you've achieved it so toward is more appropiate.

Obviously others' views differ, but I don't see excellence as an
unattainable goal at all. Perfection is unattainable (by human
beings), but excellence can certainly be reached. On occasion, I think
I've been there.

If excellence were something that can only be traveled "toward,"
rather than "to," would there be academic awards such as degrees "With
Highest Honors"? Is such a degree just another echelon of mediocrity,
while true excellence is forever outside our grasp?

The almost absolutely arbitrary method says ...

Google search on: "Leading the way to" - 305,000
://www.google.com/search?q=%22Leading+the+way+to%22

Google search on: "Leading the way toward" - 27,400
://www.google.com/search?q=%22Leading+the+Way+toward%22

Maybe the Vice Principal just never made it to excellence.

That might be why she isn't the Principal.

Transfer your child to a school that will not accept anything
less than excellence!

I prefer "toward" (personally prefer "towards").  
Excellency must be achieved by oneself; one can only be led or guided
in its direction.  If the elementary school could lead pupils TO
excellency, this would suggest that all could achieve it, whereas
"toward" suggests that the school can only help and guide pupils to
achieve excellency by their own effort.

Myoarin