It is of course, part of the entire package. Whomever you choose to write it matters a great deal.
This person should be very familiar with you, over the course of many years.
Try to eschew the "family friend who happens to be a Air Force Colonel who has never met you, but he's a Colonel so that must be cool" sort of person. This guy doesn't know you and his recommendation has no more weight than the guy you order your #8 from at the sandwich shop.
The Academy wants to get a picture of you as an overall person. A snapshot of you in life right now, and where you're going in the future.
The only person to reliably supply that snapshot is someone who knows you really well, and will be honest and forthright.
I hope that helps.