I've definitely made latkes before without deep frying them - just pan frying them on the stove in a little bit of cooking spray - and they still come out fantastic
Here's a pretty good recipe (makes a lot):
Source: "Fat-Free Holiday Recipes" by Sandra Woodruff, RD
Yield: 24 pancakes
* 2 1/2 pounds large baking potatoes * 1 medium Spanish onion * 4 egg whites * 2 tablespoons unbleached flour * 1/2 teaspoon salt * 1/4 teaspoon ground white pepper
Scrub the potatoes, but leave them unpeeled. Coarsely grate the potatoes into a large bowl of ice water. Let sit for 5 minutes. Drain off the water and roll the grated potatoes in a clean kitchen towel to remove excess water. Coarsely grate the onions.
Place the grated potatoes and onions in a large bowl and add the remaining ingredients. Stir to mix well.
Coat a large nonstick skillet or griddle with nonstick cooking spray and place it over medium-high heat. For each pancake, spoon 1/4 cup of the batter onto the skillet and spread to form a 3 1/2-inch pancake. Cook for 6 minutes on each side over medium-low heat or until golden brown on the outside and tender on the inside. As the pancakes are done, transfer them to a serving plate and keep warm in a preheated oven.
Serve warm with applesauce or nonfat [SOY] sour cream.
You can also bake-fry latkes by frying them in the oven. Preheat a nonstick frying pan in a hot oven. Spray it with olive oil (or place a few spoonfuls of oil on the baking sheet and swirl it around with the back of a wooden spoon). Spoon the potato mixture onto the baking sheet in small mounds and "fry" the resulting pancakes in the oven. The hot baking sheet acts like a deep fat fryer, while the small amount of oil helps the latkes crisp and brown. Bake-frying works better with smaller pieces of food, so form the latkes in 2-1/2-inch disks that you can gobble in one or two bites.