Again, this used to work in earlier versions (although I suspect this is more of a question about jQuery than jGrid — sorry about that; I hope someone knows the answer anyway)
You used a old autocomplete plugin, which work quite diffrent from those provided in jQuery UI 1.8.2.
In order to resolve:
1. You should change your code according to the new plugin
or
2. If you download the jQuery UI do not mark the autocomplete widget and use the old one. Do not forget in this case to include the old autocomplete in head section