Hi Dawn, a proposed patch can be found at MDL-15052. You could also try to contact with Gary Anderson who also created another similar patch (to change the pull-down menu from 0-100 to a text field which could accept any number, including decimals, from 0 - 999.)...
Not sure why a lot of this type of proposed patches for usability improvement were decided not to go into core, so you probably will have to patch it by yourself for local customization.
Hope this helps...
Changing max grade
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