Bug or "feature"? -- "Drop lowest" drops quizzes that can't be automatically graded, for example, quizzes with essay questions. See here:
100% Quiz Score (T/F) = a quiz where the student scored 2/2 points
50% Quiz Score (T/F) = a quiz where the student scored 1/2 points
Ungraded Essays = a quiz with two ungraded essay questions
Before the test student took the essay quiz the 50% Quiz Score (T/F) was dropped. After taking Ungraded Essays it was dropped immediately instead of 50% Quiz Score (T/F), even though it hasn't been assigned a grade yet.
So, thoughts? Bug report or Feature Idea?
I'm going to call Brian's response to this the correct answer. It at least explains the behavior technically, even if it doesn't make sense practically. That being the case, I've opened a Feature Idea: Quizzes: Stop Assigning Zeros to Ungraded Essays