<p>Ya, there have been quite a few friends of mine who are going to fairly strong graduate programs despite lackluster GPAs. However, I had a 3.96 GPA in physics and got rejected by a large number of top schools; I also had basically perfect GRE scores. The thing about graduate school admissions that I have learned is that the letter of recommendation kind of trumps all at top schools, and mine were nothing to write home about. They werent bad, just not spectacular. I am actually pretty lucky that I get to go to what was my top choice school next year (UCSB = ranked 3rd in condensed matter physics + Kavli Inst. of Theoretical physics + beach). </p>
<p>Professors at top schools like Mudd went to top schools themselves, so their opinions are taken quite seriously. </p>
<p>Anyways, I would say that in order to be in good standing for top grad schools, you want at least a 3.6 GPA (in your major). Getting higher than that helps, but not as much as you think. Beyond that, you want solid GRE scores and then solid letters of rec. from your thesis advisor and at least one other professor.</p>