Gilles, as usual you are being extreme and you are not allowing for any middle ground. Both KIA and I seem to agree that one of the benefits of grades is that it keeps the parents honest. Are they working with their children? Are they taking responsibility for their children's development? Are they spending time with their children on homework, reading etc? If my child got a D or an F that would be a wake up call for me, not the child.
The use of cut and paste, stock standard comments enable things to slip through far more easily than grades do. And for the record, my grades always came with comments attached so we got both.
Not everything is wrong with the past. In fact, I'd say the old school ways prepare you much better for life than the cotton wool tactics employed today do. Perhaps when your children are 30, still living at home, asking for money every other day and crying to you that they don't like their 4th job for the year and want to quit because it's hard work and they deserve to be manager already you'll rethink your stance.
As I said before, you don't have to show your children the grades but it's bloody good to know what is going on.