Can't recall ever seeing evidence that supports that, so I consider it as much a rumor as these new "grenades" that have been added to spice-up the story.
The BATF and the FBI refused permission to outside experts that offered to examine guns retrieved at the scene, which causes me to doubt that any full auto conversions had taken place. I watched both the House and Senate hearings on the event and I do not recall any evidence of 50 caliber weapons or live grenades. It was mentioned that some dummy grenades were in the building, but the only live grenades were ATF grenades that had not exploded after being thrown in. I think I have scene all the live footage that has ever been made available of the initial raid and there were no grenades exploding outside the building. Too bad the government could not find the tapes from the four or five video cameras that the BATF had running when the raid started.
Chief Dan George to Clint Eastwood in “The Outlaw Josey Wales”. :-)