Firstly, there are "grads" at my firm that are mid-30s so from the feasibility side, it's doable. The impression I got from talking to some of these - one in particular with a similar contracting background - are mixed.
- stability/sense of belonging
- although there is a lot of work to do, there is also a steady progression of work-load
- watershed on CV, a good milestone in 2/3 years
- fresh start
- more credibility when taking on responsability
- Easier to network with managers and get onto jobs
- firm more keen to progress you quickly if you are good
- dealing with 21 year olds
- possibly being managed by a 24 year old
- patronising at times (especially first few months)
- feeling under-valued (especially at the beginning)
- struggling to fit in (especially at the beginning).
- feeling out of place. Although it may seem trivial, getting along with the other grads I think is important for getting your barings.
- Sense of frustration at how mundane the level of work is
- Having worked as a contractor, you will not like being fed corporate mantra and the sterile one-for-all approach.
- you're a grunt
Overall, I would encourage it if you're ready to start from the bottom of the pile. There is a lot of rubbish with regards to the glamour of graduate schemes. They are overhiped in terms of what they give you in practical terms but they are very useful for (re)building a career.
My advice: assess where your present contracting work is going to lead in let say 5 years time. If it's not anywhere particularly fullfilling I would go for it. You probably will not like the first few months but if you stick it out it will broaden your opportunities.
Hope that helps!