That's true too, but let's not disregard the facts that:TheUltimateNinja wrote: Goku was trying to last as long as possible to show Gohan all of Cell's moves, though. If he went Grade 2 he'd run out of stamina too quickly.
1) If Goku could power up beyond his full power SSj, he probably wouldn't rely on Gohan.
2) It's likely that Gohan was considered to be the last resort at first. It took Goku time to realize that he can't actually beat Cell, at first he fought with the mindset that he probably can win by himself. To that end he tried everything. The battle wasn't solely meant to be a demonstration for Gohan.
3) Grade 2 sure would have Goku worn out more quickly, but it would also make him so much more powerful that he wouldn't need as much time. Only even battles are dragged out - battles where one has the advantage can be finished very quickly, unless there's toying involved.
4) Gohan's knowledge of Cell's moves became inconsequential when he turned SSj2 anyway, because he was so powerful he shat on Cell anyway.
So there's two possibilities: either Goku did have Grade 2, but refrained from using it because he thought it might not be enough, or he simply couldn't use it/it woudlnt' have made him any stronger than he already was. The first option can't be true in my opinion because as I said, Goku couldn't tell what reserves Cell still had, if any. Cell powering up to full power later on caught Goku by surprise, just like it did all the others.
If Grade 2 could make him stronger, Goku would have tried it to defeat Cell, simple as.
Oh, and they had Senzu beans too, forgot about it?