I agree with Pompacil, there is way more to an applicant than the name of their school. But if I had a choice between a well known institution and a lesser one, all things equal I would pick the one with the reputation. It will help you several fold, the first and foremost is the obvious name recognition, but, as Pompacil said, it will also tend to have big name orthopods on staff (which in my opinion will matter more in the end than the name of the school.) The way those of us that come from "lesser" programs is to do aways at "big name" places and get the letter of rec by busting our a$$ for 4 weeks. (Not to say the home students don't work hard too)
If you have a big draw (ie. family/significant other in the the area, large difference in cost, ect...) to a lesser known school, it is not the kiss of death for someone interested in ortho. You just might have to work a little harder than you competition from the big dogs!