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When I was a young and impressionable graduate student at Princeton, we scared each other with the story of a Final Public Oral, where Jack Milnor was dragged in against his will to sit on a committee, and noted that the class of topological spaces discussed by the speaker consisted of finite spaces. I had assumed this was an "urban legend", but then at a cocktail party, I mentioned this to a faculty member, who turned crimson and said that this was one of his students, who never talked to him, and then had to write another thesis (in numerical analysis, which was not very highly regarded at Princeton at the time). But now, I have talked to a couple of topologists who should have been there at the time of the event, and they told me that this was an urban legend at their time as well, so maybe the faculty member was pulling my leg.

So, the questions are: (a) any direct evidence for or against this particular disaster? (b) what stories kept you awake at night as a graduate student, and is there any evidence for or against their truth?

EDIT (this is unrelated, but I don't want to answer my own question too many times): At Princeton, there was supposedly an FPO in Physics, on some sort of statistical mechanics, and the constant $k$ appeared many times. The student was asked:

Examiner: What is $k?$

Student: Boltzmann's constant.

Examiner: Yes, but what is the value?

Student: Gee, I don't know...

Examiner: OK, order of magnitude?

Student: Umm, don't know, I just know $k\dots$

The student was failed, since he was obviously not a physicist.