Did they stop the quest for people with PHD's or abnormally high grades? I hadn't heard that.
They don't care about your grades, unless you are fresh out of college and have nothing on your resume, and no special projects.
They don't care about what degree you have, unless you did something special in the process of getting your degree.
Maybe it was different in the old days, but there are plenty of old timers at Google with no special degrees. Some don't even have undergraduate degrees. I myself had a 2.2 GPA. They never even asked for it.
I think the degree/GPA thing was just an excuse people used when they didn't get an offer.