<p>In the past Chicago almost never took their own students. They, and many other schools, believed one should have a broader experience. (I know of students who decided not to attend Chicago undergrad because they thought it would give them a better chance at graduate school at Chicago.) This has changed in the past 20 to 30 years, but, I believe, most students in grad school still come from elsewhere. While I was a grad student there was only one student in our lab who had been a Chicago undergrad. In the program as a whole there were only a few. I know some recent grad students whose departments have former Chicago undergrads, but they too are largely made up of students from other schools. If one truly is outstanding and has impressed the faculty, it may now be an advantage to have attended as an undergrad (but that means many more winters in Chicago… [though if anything like my program, one seldom went outside enough to figure out what time a year it was, we didn’t even have windows in our lab]).</p>
<p>As for grades, graduate schools tend to understand the grading policies of the various undergrad schools. Reed College, for example, places a huge percentage of their students in Ph.D. programs (many at Chicago) though their average GPA at graduation is 2.8. A 3.25 at Chicago will impress most grad schools, but letters of recommendation (and often phone calls) and other indicators such as undergrad research, etc. are often more important.</p>