Here is how a DI head coach described it to me:
The NCAA defines a "full scholarship" as the cost of tuition, fees, housing, meals, and books for an "average student" at each school. Therefore, at state-supported universities, a "full scholarship" is determined by the weighted average of those costs spread across the entire student body. That causes it to be reflective of the proportions of in-state and out-of-state students and the relative difference between in-state and out-of-state tuition.
Each year, the AD's office takes the dollar amount of a "full scholarship" and multiplies it by the number of scholarships a sport is allowed. In the case of DI baseball, that number is 11.7 (where the program is fully funded). That result gives the baseball coaching staff its scholarship budget for the year, which is then divided up among the players.
Even though a "full scholarship," by definition, exceeds the costs for in-state students, my strong impression is that most DI coaches at state-supported universities generally "low ball" their scholarship offers to in-state students, reserving a disproportionate amount of their scholarship budget for out-of-state players.
They have a variety of reasons for approaching the exercise in this way. Included among these are (1) the presumption that in-state players are more highly motivated to attend their home state's school and (2) the attendant costs are lower, thus easier for in-state families to bear. Meanwhile, they often feel they have to "go the extra mile" with out-of-state players in order to win them away from their home state schools.
(By the way, not all states offer a "relaxation" of out-of-state tuition like that mentioned earlier by TigerPawMom. It varies from state to state.)