Hi Intertrode
1- how important are recommendation letters, and will non-academic letters sink my application?
Reco letters very important. Remember you are communicating over long distances and adcomms are looking for what makes you an ideal candidate for research. Once the basics are over (GMAT/Transcripts), shortlists are decided upon on reco letters and SOP's. Both need to be attacking, indicating why you are interested in research and why PhD excites you. An academic can certify to your research ability, a non-academic cannot. Hence if 3 letters are needed for a particular university, make sure you have at least two from academic sources. Yes, only one academic reco can lower your app at some schools.
2- realistically, will my limited involvement in research hurt me?
Oh no ! it will only boost your app, showing that the academic environment interests you
3- when I start meeting with/corresponding with professors here and at other schools, how much do I really have to know about the field?
Most applicants know very little about academic research and it is not essential. What is essential is the 'potential' to do research. Your interests, your excitement for future as an academic - if this comes through your mails etc, you are there !!
Best Wishes,