Whilst we all know that grade also refers to the intensity/degree of quality, I got this doubt looking at Jim's comment here. Although, looking at his sentence, it's clear that he's talking about the teacher teaching students of Grade IV.
In India, standard is more common as compared to grade for schooling. And it does not create ambiguity because if the thing is of top quality, it's of standard quality but then if it is not, it's substandard and not second, third or fourth standard. If you put adjective first, second, third... and the like to the word standard, it always refers to schooling.
The ambiguity rises when we use grade. If I call someone A third grade often in anger or sarcasm as in here - it simply means **dumb, manner-less, awkward* person. So, if I want to refer to some teacher/pupil as a wicked person with third grade quality, how do I do it?