 Ranks
Oogie's Revenge is a game based on chapters and ranks. There are 24 chapters, plus 2 secret ones. After completing a regular chapter, you get four things ranked: your time, combo count, taken damage, and exclamation marks count.
These ranks can be D, C, B, A, S; D being the worst, S being the best. You also get an overall chapter rank, which is the average of these, rounded down.
Clearing time is the amount of time you needed to complete the chapter. Of course the lower it is, the better rank you get for it. Skipping cutscenes does lower this time, which is wrong, but live with it. Combo count is the highest number of consecutive hits you deal, the higher it is the better. Taken damage is the amount of times you get hit, the lower the better. Lastly, exclamation marks count is the number of exclamation marks you get (see in the fighting basics), the higher the better as well.
 Are ranks important, you might ask. Depends. If you merely want to have fun completing the game, the answer is no. On the other hand, high enough ranks will unlock secret stuff, such as new costumes for Jack if your overall game rank is high enough, although indirectly, but infinite fire. You'll also get more souls to spend for shopping.
While the extra costumes do look cool, they are useless, they don't give you any special abilities. However, infinite fire and more souls are more than useful. Infinite fire, for which you have to collect all figures (that includes having at least A for every rank in every chapter) makes the game very easy. More souls to spend in the shop mean more powerful Soul Robber and other attacks.
So the final answer is, good ranks are not needed at all, but they are extremely useful.
 Since the overall chapter ranks are the average of the four ranks you get rounded down, that would mean getting an S overall game rank (S rank for everything in all chapters) is nearly impossible, especially in harder modes. Fortunately, it doesn't work that way. When you finish a chapter, your ranks get saved. But after that if you replay that chapter, and get a better rank at something, that better rank gets saved, and the rest stays.
This basically means, that you can simply do the following, and it will work for most chapters: let's say you're playing for the first time, and don't know where to go yet. That's completely fine, take your time. But before finishing the chapter, make sure you get a high enough combo, and a high enough exclamation mark count. When you finish, you'll get very good ranks for those two, preferably S. Then you replay the chapter, but this time you try to hurry, skip cutscenes, avoid fights, and try not to get hit if you get into one anyway. There, you have your other two S ranks. 
You will need to complete both secret chapters as well to get an S overall game rank.
Game Modes
There are three game modes: Easy, Normal, and Nightmare. In the first two modes, you only lose one health point (half a pumpkin) if you get hit, while in Nightmare mode you lose two points. If you're playing for the first time, you should go try Easy mode, mostly because in that mode where you have to go is marked on your map. Items are cheaper too, and one of the abilities is only available here.
Rank requirements also depend on the difficulty mode. They are very low in Easy mode, but can be a nightmare in Nightmare mode. The last difference is that the harder mode you choose, the stronger the enemies are. In Easy mode they have half of their Normal hit points, and third of their Nightmare hit points. (Hah, I guessed right about this! Now it's confirmed...)
 Souls
When you defeat enemies, they will drop various souls, which you can collect either by walking through them, or by using the Soul Robber. There are four types of souls. The ones that are coin shaped and you can spend them in the shop, we'll call these Soul Coins. See the others below.
Soul Coins
In the game they are not referred to as "coins", but since there are other souls of the same colors, they will be called that here.
 = 1 Soul Coin
 = 10 Soul Coins
 = 30 Soul Coins
 = 100 Soul Coins
Other Souls
 - Increases your current hit points. The bigger it is, the more it will heal you.
 - You can carry up to 5 of them. You can also buy them in the Witches' Shop. When you pick one up, it goes to your inventory, or if there are already 5 there, it just gets activated. When using a the Soul Robber's color changes to blue for a few seconds, and in the mean time it has a longer reach and deals more damage.
 - These souls are used for Pumpkin King Jack's attacks. By default you can carry up to 5 of them, but when buying upgrades in the Witches' Shop, this limit can go up until 10 (or infinite, if you collect all the figures).
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