There have been NUMEROUS recent "breed" attempts, crossing wolves with GSDs, to create an "improved" version of the breed. Almost all these attempts failed because wolf hybrids maintain a skittish temperament that is not suitable for most work.
Sarloos wolfhound would be the most noted, bred by a Dutch man. Hoping to make a breed closely related to the german shepherd that was also immune to distemper and possessed less "domestication" and more intelligent working capability. Several of his first dogs resulting from these breedings died of distemper (and in fact the first she-wolf he purchased also died of distemper), and were to skittish and lacked the will to attack to even perform in sport.
Czechoslovakian wolfdog is a better example, carpathian wolves crossed with WL GSDs to produce border patrol dogs. Much better working capability as they lack much of the skittish behaviors other hybrids posses, but training can still be very selective and challenging.
I guess point here is hybrids more often then not do NOT posses the qualities that Max was looking for in his breeding program. If they did exist (and it's very possible they did, remember he used herding dogs as his founding stock and they could easily of cross bred), it is unlikely they would of been the leading stock for the foundation of the breed. A few may of possessed traits he was interested in, but I find it very unlikely he would of used a large number of F1 hybrids. And even if he did, as someone else pointed out the number of generations that have passed, probably 40-50+, it would make very little difference.
The russian farm fox experiment showed that it takes only 14 generations of selective breeding to DOMESTICATE a fox. Not tame it, but actually domesticate it to the point that dog-like features are exhibited (coloration change, curled tails, rose ears, barking, etc... Interestingly enough this experiment also showed that there was a direct link between domestication and physical change - which is how we have the variety of breeds we do today). If a fox can be tamed and turned into a new species in essence in only 14 generations, then 40 generations would wipe out any trace of "wild wolf" in the german shepherd breed.
~Emergency Vet Tech
Berlin vom Spartanville 1/13/13
2008 - 7/23/12
"Take this trouble from me: Make sure my shepherd dog remains a working dog, for I have struggled all my life long for that aim." Max Von Stephanitz