Having a spouse who has taught at the UG level gives me a special insight into this. Grade inflation exists not to benefit students, but to protect Assistant Professors at teaching heavy schools (as opposed to a research powerhouse like UC Berkley), who are judged for rank promotion and tenure primarily on student evaluations. If you don't give out lots of good grades, your evals suffer accordingly
Why are you against grade inflation? Do you do some sort of negative compensation for places known to inflate to ridiculous levels or do students in fact benefit from inflationary policies?
I'd also like to point out that many of us on Adcoms have no idea if XYZ U is a good school with grade deflation (or inflation). As such, comments like "well, she went to U Chicago and had a 3.4, that has to count for something" occasionally get floated when discussing a candidate, but then they get ignored. School reputation does help Admissions deans because feeder schools have a known product (for example, our state schools system out here in Goroland are good, and the two local state schools provide most of our students. Does this mean we'll reject someone who did well from Kutztown State? or Pepperdine? No! To us, doing well anywhere, in any major, is a good sign.
To reiterate what the exceptionally sage Mimelim has stated, a seat in medical school is not a reward for good grades or being a good student.
Could a 3.30/35 get accepted into, say, Vanderbilt? Yes. Said student may have bomb freshman year, and had straight A's for the remaining time. Unless you have their packet in hand, there's often more than meets the eye. this is why, when I give "What are my chances?" advice here, I look for comments like "steep upward trend" or strong rising trend" in posts.