When I was in grade school, they were just trying out this "feel good about yourself" curiculum.
Teachers were not allowed to correct in red because the color was the same as "stop" and would discourage us.
We also had a thing called "inventive spelling" (I bullshit you not!) It didn't matter how we spelled the words so long as we were confident in our answers. The same applied to grammar. I was simply never corrected.
Today I am an English major. Almost done, heading into my masters very soon. My spelling and grammar continue to be major stumbling blocks, and if I hadn't been raised by a family of English teachers I would be totally lost.
I agree. We aren't doing kids any favors by not correcting them. It does not prepare them for the real world where failuire is a fact of life. Daily. They will be arrogant in the workplace (which never helps anything), incredulous about critique (which will stunt professional and personal growth), and will crash and burn when they find out they aren't the precious, unique and perfect snowflakes their "educators" have said they are.
But it's important to not blame the teachers. They hate that kind of thing as much as I do. And it's not all parents, either. It's the five or six whiny PTA Nazi parents and the mental health "professionals" they pay who are doing all the damage.