There have been some heated discussions about this on auntminnie.com lately...
In my opinion, you should apply to lots of programs of varying quality, regardless of how competitive you think you are.
My step 1 score was not great, but other factors in my application led to a very successful interview season. I interviewed at most of the top programs in the country, and received better interviews and feedback than most of my peers.
Your step 1 score is one of many, many components of your application. Work hard to round out the rest of your CV so that you have many things to offer, and you will not be ignored.
Cheers,
doepug (MS IV)