Well, I certainly can't claim to be an expert and what follows is mostly my surmise so take it with a grain of salt.
I don't think anyone would dare to guess what USNA considers when awarding an LOA. The rumor mill lately says they award about 150 a year (I think that was Navy). So if that's the case then it seems rather unlikely that a district would have more than they can nominate, and further I'd like to believe USNA is smarter than to set up a situation like that. I suppose it is theoretically possible though but I've never heard of such a situation.
The LOA will often figure into the MOCs nomination slate. When someone on the slate has an LOA, frequently a MOC will pick someone else on the slate to be a principal nominee. That person gets to be the nominee for that slate. The MOC will normally also include the LOA candidates further down on that slate (so make sure the MOC knows you have an LOA). Given that only a nomination is needed to get an appointment with an LOA, the MOC just got 2 or more kids into USNA that year, although only 1 will be charged to him. I hope this makes sense. You can bet MOCs will want to get as many of their people into the academy as they can.
There is one more thing to re-emphasize, and that is your DD should apply for every nomination she is entitled to. 1 Congressman, 2 Senators, and the Vice Presidential nomination (and anything else like Presidential, ROTC, etc). It gives the candidate more opportunities to get on a slate and that's important for LOA holders just in case there is that magic 11 LOAs in one district. Finally, in NOVA I believe the Senators and Congressman coordinate their slatesso people don't get multiple nominations, but only 1. You would like to think one of them will make sure that LOA holder gets on some slate.
Your DD is correct. Ultimately, there are no guarantees but an LOA is about as close to one as she will ever get. That doesn't mean she can take her foot off the accelerator though. Continue to work backup plans in case there is an injury or a DQ. Who knows? Maybe she will change her mind about Navy by this spring? Be prepared for all contingencies and to borrow a phrase from tugboat... Push hard. Press forward.
For other readers: Yes, I may have oversimplified some aspects but I'm trying to give the reader a model they can hold in their head.