I have run across the same fact, though I am having some trouble finding a link. (Best I can do is the
alt.folklore.urban FAQ. Search for Einstein.
The version that I heard was a little more specific. The German school system had 4 is very good and 1 is very poor. The Austrian was reversed. Because this caused confusion the Austrian changed to match the German very shortly after Einstein went through. So when a careless biographer looked at his grades...
However people who want to think of Einstein as some rube from the hicks still can take comfort in the detail that he wound up marrying his first cousin...
