David, I have experienced the same thing in 2.6.
For me there were two issues:
1. The first was that as I am the Administrator and not a teacher in any courses, all I saw was the smiley face and the text 'Nothing to Grade!
To fix this I went to:
Administration > Site Administration > Plugins > Blocks > Grade Me and Checked the option for 'Admins View All'.
This allowed me to see all ungraded assignments across the site.
2. The second issue that I encountered was when a teacher was not seeing any ungraded assignments for her to grade when we knew that there were many ungraded assignments in her course.
This was being caused by the assignments using a custom scale for grading.
Grades for assignments are stored as numbers in the database as 1-100, 0 for 'No Grade' and negative numbers for grade scale items (i.e. -1 or -7).
The assignment plugin in the 'Grade me' block will only return items where the grade field in the assign database table is greater than 0.
The code can be found in: blocks/grade_me/plugins/assign/assign_plugin.php on line 56:
WHERE asgn_sub.userid $insql AND a.grade > 0
The AND a.grade > 0 means if any of your assignments have 'No grade' or a scale set for for the grade then the assignment will not show up in the 'Grade me' block.
To fix this I simply commented out the 'AND a.grade > 0' so the line in the code now looks like this:
WHERE asgn_sub.userid $insql /* AND a.grade > 0*/
Alternatively, if you want to exclude any assignments that you are not grading (No grade), then you could use this:
WHERE asgn_sub.userid $insql AND (a.grade > 0 OR a.grade < 0)
Hope this helps.