I'd say it depends on the program. I know someone in dental school whose father is the program director of an Orthodontic program—he is guaranteed to get accepted without worries.
Additionally, I have talked to program directors, who were very proud that they were able to send their kids through the residency programs. It doesn't mean you wouldn't get accepted into the same program though.
For ortho at my school - last cycle 7 people got accepted into ortho programs. Of the 7 people (2 got accepted to school X, 2 in school Y, 2 in school Z, 1 in school A). Multiple people from the same school can get accepted into the same residency program. So don't let that stop you from trying if you like the program!
Edit: I do think shadowing the program director would be a massive plus at any program, but most program directors wouldn't allow it. If the individual has a good relationship with the program director and gets a decent CBSE score, I would be surprised if they didn't get in. For sure worth a shot to try - as long as there are multiple spots at the program!