A little clarification...
Remember, there are not one, but two admissions processes, and you have to get both in order to get in. What am I talking about? A nomination is from a political office - Senators and Representatives get a few nominations each, with several of them being designated as their 'primary' candidate. The President, V.P., SecNav, and some other big shots get to nominate people, too. Oh, and if your Dad won the Medal of Honor, and you're otherwise qualified, that counts as a nomination too. Don't know how often that happens, but it is one of those Medal of Honor perks.
How does this shake out in the admissions numbers? Well, it guarantees geographic diversity, which can translate to really smart, well-qualified kids not getting in because they're in a very, very competitive congressional district, and less-than-stellar kids getting in because they were the only one to apply in their district, and are marginally qualified. For example, Norfolk or San Diego, where the Navy and Naval Academy are 'big', there's huge competition. Rural (or for that matter, urban) areas with poor educational systems also get an equal number of slots (I'm speaking specifically of House of Rep.s nominations, which are by far the most numerous), resulting in candidates who may be less-qualified than those applying out of better-educated and more Navy-minded areas.
Speaking from my own experience, rather than hear-say and conjecture, though, there are few drop-dead requirements. The admissions boards are looking at the 'whole person.' I had a 3.2 or 3.3 in high school, which 'should have' disqualified me, but the board was gracious enough to consider that I graduated in 3 years, got a 1480, and some other off-setting stuff. Incidentally, you may have some flexability in where you apply from; I'm not advocating that you 'game the system,' but... well, my own experience: I had lived in Lemoore, CA for one year when I applied to USNA, but I applied through my Texas congressman (my Dad being active duty and a Texas resident) and was fortunate enough to get in. In retrospect, it would have been much, much easier to get the nomination in a rural, agriculture-based area such as Lemoore, but it all worked out.
Finally, I resent this:
<<If you're more into the leadership stuff, then maybe OCS or ROTC is a better choice.>>
I'm not one to start a 'oooh, my commisioning source is better than your's' spat, but you have to realize that - despite your rather cynical anecdotal speculation - the vast majority of those accepted into USNA are very well qualified to lead, and were accepted in large part because they were leaders to begin with. As soon as you discover a reliable method to uncover the true moral fortitude and leadership potential of each candidate, be sure to let the admissions board know about it.