Well SF Pride tried to cover itself on this one, but I suspect that what happened was that the grand marshal committee (made up of former grand marshals) got overridden after an unexpected national "Oh no you did-dint!" from the gay community.
Earlier today it was announced that Bradley Manning would be the grand marshal and that Daniel Ellsberg would stand in for him. The gay service members association and spouses of gay servicemen, and all manner of just plain everybody except the nutjobs in SF responded with a loud "No, we won't".
It was announced a little while ago that the entire thing was a mistake made by a parade associate who didn't have the authority to make such an announcement.