as a reapplicant and having called a number of schools re: this very issue....IT'S A STRONG YES!!!
I applied in the 2005 cycle, so all my letters were dated late '05. I'm reapplying this year, and as far as schools are concerned, all they see is a 2-year old letter. Now of course some of those letters were strong, and still say a lot about me, so i def. plan to use them. But i will definitely be supplementing them with LORs from this year (new professors, new activies, etc.). For one letter in particular, I asked the author to resubmit, possibly update, but at the very least, change the date. She did, and now it shows 2007 on there...I feel it holds more credibility b/c it shows that 1. that person has known me for a longer period of time and 2. that i've kept in touch and that this person probably knows me better as a result.
you don't HAVE to, but i think it's highly recommended. Although for letters from prof. you had during undergrad, i think it's understandable if they're "old".