It's all a relative thing. E.g. if you're going into something ultra-competitive yeah one bad mark can blow you out of the water if everyone else have no bad marks at all and there's not enough spots. People in admissions committees even admit such things are BS and only do knock some people out (in ultra-competitive situations) cause they don't have enough spots and have to rely on something...anything, to weed anyone out.
In psychiatry, however, despite that its getting more competitive, one bad mark likely won't make any difference. Many medstudents use their last frame of reference, getting into medical school, as the benchmark of how bad it's going to be. Getting into psychiatry residency can be competitive but it's several orders of magnitude less stressful vs getting into medical school.
I would liken getting into psych residency as more comparable with getting into college in terms of your odds. Of course medical school is harder than college (unless you were a triple major, Biochem, Physics, Chemical Engineering, Rhodes Scholar), but in terms of your grades and board scores, your odds of getting in is more like getting into college. You'll very likely get in so long as you pass your stuff without stellar marks, but will then likely get into a lower-rung residency.
I remember during one of my rotations, I had one bad review, and to this day I think the guy was an a-hole. E.g. he'd pimp me on questions about Digoxin, and when I answered all of them right he'd start doing idiotic things like ask me questions about the Digitalis plant ("You didn't know it grew in Asia? AND YOU DIDN'T KNOW IT'S ALSO CALLED THE FOXGLOVE!?!?!," What an a-hole). It was the only bad review in my rotations among pretty much all of them being top marks. None of the programs cared.
