At BibleTech:2008 James Tauber of MorphGNT.org gave the opening presentation in Room 1, “MorphGNT and the Building of Linguistic Databases for New Testament Greek,” during which he shared a little bit about his work on a graded Greek reader. Unfortunately, he ran out of time and had to rush through his material. The MP3 audio is available at the BibleTech Conference website. He discusses the graded reader at the tale end of his presentation (50:15–55:30).
He argues for a more inductive approach to learning Greek, and suggested that word frequency is not the best choice for the order in which students should learn new words. Students should first learn the words that occur together most frequently, allowing them to read a broader base of the Greek New Testament earlier on. He also suggests learning the inflected forms first, and then learning the lemmas and other deductive categories later.
The biblical text would be a combination of Greek and English words (following Greek word order) that would take into consideration the vocabulary that the students have learned. As they learn more, the English words would become Greek words. This approach allows students to dive in just about anywhere in the Greek New Testament without the clunkiness of multiple levels of text that you get with interlinears.