Echo the person who talked about wanting to perform up to your own peak -- if you're hitting 170 on practices, a 163 is probably worth a retake. Your boss might not understand, but in the long run there's a lot of other people whose opinions will matter -- yours included. If it makes it easier, go and revisit, and explain to him that you just didn't feel at home -- which, if stotan is right, you probably won't. At that time, you'll have a stronger LSAT (if not, the scenario is moot) and a sense that you didn't really belong there. I'm sure he'll understand: you are, after all, only following in his footsteps. And, if he doesn't, again: there's a lot of other people who matter, too.
Plus, I bet you can find something cool to do for a year.
And for the GPA to keep you out of Harvard despite the 180, it would have to be pretty low -- I bet you'd stand a better chance than you think.
PS1: We're in for a recession, sure, but the worst one since the Great Depression? Ridiculous. If this turns out worse than the Carter recession, I will personally sell all my baseball cards and issue a low-interest adjustible rate loan.
PS2: Wally, I grew up in Berkeley. Anything on your mind?