I've had a look at startupmanager, and don't see anything in there that would have created a /boot/grub/default of this sort. If you also didn't create it by hand, I don't know how this file came to be. I would suggest resetting it with 'grub-set-default 0' to work around the problem you're having.
Still, 'grub-set-default default' is part of the documented interface for this command, so update-grub should be able to handle this case. Confirming this bug.
I've had a look at startupmanager, and don't see anything in there that would have created a /boot/grub/default of this sort. If you also didn't create it by hand, I don't know how this file came to be. I would suggest resetting it with 'grub-set-default 0' to work around the problem you're having.
Still, 'grub-set-default default' is part of the documented interface for this command, so update-grub should be able to handle this case. Confirming this bug.