Gradebook

we're running 1.99, its the LAE version but the libraries for the standard grader report have been unchanged. I don't see this behavior after changing the gradebook setting "Overall decimals" to zero, then assigning a grade to a grade item of 8.5 and updating. The grade displayed is immediately rounded up but the grade recorded in the grade_grades table for that student for that grade item remains 8.5.

I'd consider reinstalling your grade tree.