As an active teacher, I see that the higher level kids definately need to be grouped. This allows for higher level thinking to be pursued especially in science and social studies. They go into depth on many subjects. The rest can be more randomly grouped. For the lowest students materials remain concrete and need more actual experiance with the concepts. The kids are more literal and unable to make inferences. That is what frustrates our higher kids when things stay concrete without any depth, the highest kids want to know why, how, purpose. I have seen both approaches in action. Schools definately do not want the lowest kids with the highest, it frustrates both groups.