Hello! Our SDE is at version 10.0, the python code is below, and the grandchildren were indeed created from their parent versions and not from the default version.Prior to our migration to 10.2, we wrote and ran nightly an "Auto Batch Reconciler," (VB.net), which reconciled grandchildren to their parent, and the parents to Default. We have not [yet] re-compiled the Auto Batch Reconciler to work with 10.2, choosing instead to use Python and the "recommended order." I can't decide if there is a good reason to recompile the ABR, or if reconciling the grandchildren to Default is sufficient. The immediate impact is: grandchildren will be ignorant of their parent's and their sibling's modifications until the user manually reconciles against the parent. I'm afraid it could result in erroneous conflicts.
import arcpy
import time
timestr = time.strftime("%Y%b%d-%I%M%S%p")
LogFilePath = '\\\abcsrv\\staff\\Administrative\\GISsoftware\\SDE_SQL_Server_Information\\PROD\\ReconcileVersionsLogs'
final = LogFilePath + "\\" + timestr + ".txt"
# Get a list of versions to pass into the ReconcileVersions tool.
versionList = arcpy.ListVersions('\\\abcsrv\\staff\\ArcGIS_Scripts\\Script_Files\\SDE_Connection_Files\\PROD_SDE.sde')
# Execute the ReconcileVersions tool.
arcpy.ReconcileVersions_management('\\\abcsrv\\staff\\ArcGIS_Scripts\\Script_Files\\SDE_Connection_Files\\PROD_SDE.sde', "BLOCKING_VERSIONS", "sde.DEFAULT", versionList, "NO_LOCK_ACQUIRED", "ABORT_CONFLICTS", "BY_OBJECT", "FAVOR_TARGET_VERSION", "NO_POST", "KEEP_VERSION", final)
# Compress the geodatabase
arcpy.Compress_management('\\\abcsrv\\staff\\ArcGIS_Scripts\\Script_Files\\SDE_Connection_Files\\PROD_SDE.sde')
print "versions have been reconciled, database has been compressed"