Actually, I've heard from a LOT of administrators that they often value a high score from a public school or large university (assuming it's accredited [sp?] and has somewhat of a good reputation) often more than a small public school, simply because it takes a lot more motivation and drive to find the resources to succeed. Big schools often don't have the advisors, instructions, and help to guide students into knowing what to take, who to go for questions, etc. You're in a sea of people, and have a huge variety of classmates to deal with. So a lot realize that it takes effort to excel in that huge mass of people, where each student is surrounded by a lot of better and lesser students than him or herself. Also, there is the question of grade inflation, which is highly contraversial, but I have personally witnessed it at Williams College and some other smaller schools.
Yet it is true that when an undergrad school is more selective, you have a smaller concentration of high-calibre students in one classroom, and that competitive feeling may drive each one to excel even higher. So that does take strength. But dental schools are not naive, and they realize that it is also extremely difficult to make a name for yourself in a huge "factory" of a place.
Note: I am NOT saying this just because I go to a public school. I was raised in a small college town and go to UMass, and I think it's crucial to understand both sides!! I know I feel like I've worked harder than some of my friends in private schools....
Can anyone vouch for this?