Sure enough, just as soon as I had posted the above, a new GRUB2 package
entered the Precise mirror and it works:

Setting up grub-common (1.99-16ubuntu1) ...
Installing new version of config file /etc/grub.d/00_header ...
Installing new version of config file /etc/grub.d/10_linux ...
Installing new version of config file /etc/grub.d/20_linux_xen ...
Installing new version of config file /etc/grub.d/30_os-prober ...
Installing new version of config file /etc/bash_completion.d/grub ...
Setting up grub2-common (1.99-16ubuntu1) ...
Setting up grub-pc-bin (1.99-16ubuntu1) ...
Setting up grub-pc (1.99-16ubuntu1) ...
Installation finished. No error reported.
Generating grub.cfg ...
Found linux image: /boot/vmlinuz-3.2.0-18-generic
Found initrd image: /boot/initrd.img-3.2.0-18-generic
Found linux image: /boot/vmlinuz-3.2.0-17-generic
Found initrd image: /boot/initrd.img-3.2.0-17-generic
Found memtest86+ image: /boot/memtest86+.bin
Found iPXE image : /boot/ipxe.lkrn
  No volume groups found
done

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https://bugs.launchpad.net/bugs/911225

Title:
  grub-update: bad 'grep' and 'lvs' invocations

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