Paul, it's unlikely but it could happen; someone turns up and actually scores a zero. That has to count towards their grading.
In practice the SWEFTA rules allow usually two league scores to be dropped and the grading is done on the remainder. Yes, if it was the last shoot, say, and you hadn't attended enough for a "full house" then deliberately not putting your card in and getting a 1 might drag your average down low enough to secure demotion.
We did have one year when all scores counted towards grading but it was very unpopular and was voted out at the next AGM. After all, anyone can have a gun failure and that score doesn't reflect your ability.
I suggested when I was comp sec that we should drop the worst score and drop the best score as well, then grade on the average of those that were left, as statistically that gave a truer picture of the shooter's position. Nobody wanted to lose their best scores of course, although they didn't mind dropping their worst, and that idea wasn't adopted.