As promised, now that I'm recovered from finals and have enough distance from the bubbleworld of school to have a reasonable perspective, I've got some stuff to say about grades, ranking, and 1L as a whole.
First of all, I maintain that grades are much more arbitrary than a sane merit-based ranking system should be. For whatever reason, I fell out on the lucky side of the toss-up this time around and I'm quite happy with my grades. If the system has to be arbitrary, I'd rather be lucky than not. So, I'm thankful. But I know the grades are only loosely related to my performance and knowledge of the material.
I've convinced myself that grades have 3 components:
1/3 knowledge of the material
1/3 writing in a style and organization that the professor likes
In schools like mine, where there are no ways to get feedback on your writing style from the professor before exams, you can only control one of the three variables. So, sure, you need to know the material--do your work and learn it at the level that you want to know it--Duh. But don't freak out and turn into a study-gnome. It won't compensate for the fact that it's just as important that the material is organized and written in a style the prof likes. And, it's also just as important that your exam comes up at a point in the grading cycle when the prof is feeling generous or particularly disposed to the points you make. The last two are a crapshoot and there's not much you can do about it, so relax.
In particular, I suspect that addressing novel issues is strongly governed by luck. If your exam is at the top of the pile, I imagine most profs reward the "right" answers and don't award many points to "off-topic" responses. However, by the time they reach the middle or the end of the pile, I imagine profs are much more likely to award points for unique thought processes or novel issues, if only because it helps 'em stay awake.
So, after a year of grades, I'm resigned to the random element and sad for the role that grades and ranking play in the hiring process. It's quite unfair that someone with a straightforward and basically correct answer who is lucky enough to have their exam at the top of the pile will get an A- and fall into a higher tier of ranking than someone with the same answer at the middle of the pile, who will get the B+ and be locked out of certain job interview opportunities. I wish there was a better way to differentiate who was deserving of the opportunities, but, I don't know of one.
As for ranking, it's silly. Attributing 100% certainty to a measurement with a high margin of error is WRONG. Most professors will admit that after they finish grading they couldn't tell a low B paper from a B-, or a low C+ from a C, or [horrors] a low A- from a high B+. In a 4.0 scale, that's a swing of up 0.3 to 0.4 points, or a 7.5-10% margin of error. But the schools will go ahead and apply a hard numerical rank to the top X percent. No one will believe that when you compare Jimmy at 98 and Bobby at 111 in a class of 200 there is actually NO DIFFERENCE between them that can be depended upon. Oh no, Jimmy is top 50% of his class and Bobby is in the bottom 50%. Silliness, I tell you.
And as for 1L as a whole, I had a blast. I know it's not en vogue to admit it, but I did. I met several new and interesting people, went to a few parties, learned tons of new stuff, was entertained by some of the best professors I've ever had, and enjoyed the freedom to arrange all non-class hours of my life as I saw fit. For the first time since I was 15 years old, I was a full-time student who didn't work. I felt spoiled and I reveled in it. I fit law school into my existing life and I loved the way it fit. Grades and Ranking suck. So do a few other things about law school. But all-in-all, law school rocks if you decide to enjoy it.
So, the advice I've got on 1L is this: Use the freedom. Travel. Be social with your classmates on at least a few occasions. Be committed to leisurely meals. Do things in the middle of the day that you'll never be able to do once you become a working stiff. Pick up hobbies (school-related activities or not) and make them fit, it makes studying easier and you'll be glad you did. For your sanity and in order to maintain perspective, be committed to at least one thing outside of school and do it religiously. And of course, be ready to fight the good fight so that you don't let anyone else's definitions of success define what you must do in order to be happy.