In preparation for my Grimm game this January, I've been reading the original tales themselves, the Jack Zipes translation. It's got the big 210 plus another 40 that aren't usually translated, so there's a lot of material to work with. I'm wondering, is it better to use the well-known stories so that whatever twist is added affects the players more, or to use the lesser-known stories so that the players don't even recognize what story they're in at all?

Hmmm, I think it's fun for the players when they see something they know and are familiar with, especially when you take an idea that they know and think they've got figured out, but you've put a big twist that they don't see coming. For my first story the only familiar characters were a resistance group to the rotten king that the players were doing work for. The actual challenges were foreign to both me and the players. I try to incorporate something new with every session so the players are constantly reminded this is a fairy tale world that they're in.