What exactly is the use of a grading system in the case of a private pilot?
He/she is not trying to compete with others to get to a university, or prove to some future employer how good he is.
He/she does not need to have a series a 'straight As' in order to get a PPL
He/she is not trying to win prizes.
They're simply trying to learn to fly, in order to have fun! For anyone going on to a CPL/ATPL - well, then maybe you need a grading system, maybe not, later on.
So all student records need to do is record the facts, for the benefit of a future instructor or anyone else who needs them. The facts. Grades and comments such as 'this man/woman will never learn to fly" are opinions. Do we need the opinions of opinionated flying instructors?
A desire for grades is nothing more than a symptom of this country's mania for grading and marking everything and everybody, to no useful purpose.