I dunno, but I often use Google as a quick and dirty spell checker. Any time I'm not sure how to spell something I type in my "best guess" as a Google search. And Google asks me "DId you mean..." and gives me the correct spelling. So far, it hasn't failed me.
They've got billions of pages indexed, many of which are not in English. I'm pretty sure among all of those they've got a pretty good handle on various languages, industry terms, proper names and even (thanks to the Urban Dictionary et. al.) slang.
Of course, anybody can have a typo or two on a page. But I don't think anybody's getting sent to Search Siberia for a couple of typos. If, on the other hand, you either can't be bothered to use spell check or don't know the language you're writing in well enough to avoid having every third word spelled wrong, well IMO your page probably isn't high enough quality to deserve a top ranking. If your content really is all that great, then it's worth taking a few minutes to proofread, fer cryin' out loud.
Microsoft Word isn't infallible when it comes to grammar, but it does a fairly decent job of flagging major errors. (I sometimes choose to ignore it in favor of more "relaxed" vernacular, but I acknowledge its general technical accuracy.) I can't imagine Google would be any worse than Microsoft Word in that regard. I'd speculate they would use fairly loose "casual conversation" rules, but there are still some grammar rules that reasonably could be applied.
From there, I think it's a matter of degree and consistency. From what I've seen, people tend to catastrophize whenever anyone mentions a possible ranking factor. Just because bad spelling and poor grammar might be a negative factor, that doesn't mean every minor typo or split infinitive will totally kill all your other optimization efforts. It's a continuum. One or two minor errors, no problem. A bunch of errors, they're going to at least flag that page for a closer review. Every other word misspelled and not a complete sentence on the page? That could be a problem.