All of the above! When I applied for college in 1990, there was absolutely a question that said “Provide the names and relationship to Applicant of any relatives who attended ____ College.” Plus yes, wealthy donors are known by name at the Development Office, and the Development folks can absolutely shoot a note over to Admissions saying “Please flag [Applicant]'s file for a legacy/development boost, thanks.”
I hadn’t considered the essay angle you mention, but I’m sure it happens–I can totally see a kid saying “I have wanted to attend University of Football ever since my dad started taking me to games when I was 8. Now we buy season tickets every year and it’s brought us closer together. My dad is my personal hero and says that attending University of Football was the best choice he ever made.”
