I actually emailed LSAC about this recently and was told that all letters on file will be sent to all schools automatically up to the cutoff # of letters accepted by a given school unless you designate specific 'targeted' letters be sent to a specific school. So assuming you don't have targeted letters, LSAC will automatically send all 3 letters unless a particular school doesn't accept that many, in which case they'll send whatever the maximum is. HOWEVER, if you have 3 general letters on file and a school accepts only 2, I do not know how you/LSAC decides which 2 should go to that particular school. Perhaps you can email LSAC and ask. They've been very prompt and helpful with me.