All is not lost! First, the most important factor is to do well in IM - get an H. Second, do the audition rotation. Third, Take step two early, with the understanding that you need to do very well on it. If you do very well it will offset your low Step I score. Lastly, as you said, IM is not as competitive. The top tier programs are very competitive, so you may not qualify for an interview. But, there are a lot of IM programs and a good number of them are excellent, not just the "top tier" ones. So, ddon't worry and try to do well in the field you are going into. Remember, a big name does not mean better education necessarily. It may give you more access to research but may also provide you with less time to do it. So, there are a lot of factors to consider.
Good luck!
Dani