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New model railroader here
So what is the best grade and color of ballast to use for an N scale layout? I'm guessing that color is a personal preference thing, but what about the grade, fine, medium, or coarse?

I would use the fine stuff as it will be the closest to scale. color depends on what was used. Could be any color from browns to dark grey all depends where it came from.
I would try to test different sizes. I know some do not use the fine because even though it is closer to scale, it generally does not look as good because the texture is hard to see.
All I know is that for my HO layout, N-scale ballast looked better.
Is there Z-scale ballast????
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