Let me answer the important parts of your question:
Is a good thing for an undergraduate student to publish in a low-tier conference as first author ? Or should the student avoid from such places and only publish in at least reputable places ?
Yes, especially if the venue is peer-reviewed.
As the answers to this question suggest, graduate schools look for evidence of research potential. The undergraduate research experience is about developing some basic skills and demonstrating that you are capable of handling a research project. Publishing at a third-tier conference, so long as there is some level of peer review, is better than no publications. Would publishing at a higher tier conference be better? Sure, but it might not be worth the effort or the risk of rejection. Publishing at a third-tier conference would look better than being rejected from a first-tier conference. Being first author on a paper at a lower tier conference should hold more weight than being a middle author on a paper at a higher-ranked conference.
Your research adviser probably has some wisdom about the level of conference at which your work should be presented. Choosing a lower tier conference is not about making your work seem less important. The choice might be about guaranteeing you get the change to present it at all.
If it is a good thing, how should the student present his study in graduate admissions process to admissions members, since the conference name is mostly unknown to much of them?
Present your work and conference presentation the same way you would present any other similar experiences. If you have to provide a personal statement as part of your application, write about the experience and how it benefited you. If they ask for a list of relevant accomplishments, include this presentation in that list. Put it in on your resumé. Ask your research adviser for a letter of recommendation.
Do not use any negative language or derogatory language when describing your experience. For example, don't mention that the conference is lower tier or that you thought you could have presented at a better one. If the admissions committee knows about the conference, then they already know about its ranking. If they do not, then you should not be the one to give any hint that you think your experience might have been sub-par.
