I guess different schools view the word limit with varied strictness.
For instance, when I raised this question to one of the Harvard Adcoms, she told me that her resistance level diminished beyond 5 words. yes - 5 words is considered off limit !
I did check the sample essays for Harvard in Montauk's and Bodine's books - if I remember right, both had exmaples of essays that comfortably exceeded the word limit but the students who had authored those did not make it to Harvard. (atleast they did not have the word [admitted] against their names)
But again the popular theory is that you are good to go if you do not peep beyond 10% of the stated word limit -> hope this is not some urban legend as all of my essays thus far hover around this limit !!