Do graduate schools care if letters are confidential or not? In general, graduate programs prefer confidential letters. Admissions officials say that it displays more confidence on the part of the applicant if letters are "confidential" (meaning you, the applicant cannot see the letter). The Letter Service is required to indicate on the letter if it is confidential or non-confidential.
How important are letters of recommendation? Letters of recommendation are required for almost every graduate school application and are a very important part of the application process. Usually grades and test scores factor in most heavily; however, your letters of recommendation could be the deciding factor in the admission process.