Definitely retake the LSAT. It's not like college where they're somewhat serious about the whole "it's just one thing we consider in our holistic review of your application package" -- it's easily the most important piece.

Your GPA is good enought to get in anywhere with a high enough LSAT score (I went to HLS with a 3.78, and now work for a large firm in SF), but if you're not in at least the low to mid-160s, you may have trouble getting in anywhere worth the money even with a 4.0. (by worth the money, i mean that if you're talking about paying $100,000-$150,000 for more education, it had better be from a school that more or less guarantees you work upon graduation.)

Personally, I think the prep classes are a waste of time and money--my method was to take pretty much all of the available real tests (you can get them from the lsac website if you haven't already) under real time conditions. My wife (whom I met at law school) took a Kaplan course though, and insists that it helped her (though I question whether she wouldn't have done just as well practicing on her own).

Oh yeah, Go Zahir Raheem!