Typically, if you have an ungraded timber (which is standard in the timber framing world; it comes from a local mill or sawyer), you should use the lowest assumed grade or run the risk of a building official rejecting a timber.
With Doug Fir in particular, it is fairly easy to get graded timbers (typically, DF comes from larger mills out west, where graders are prevalent), so specifying a higher grade in such species is not uncommon. (I've even specified Dense SS DF once...)
You can get a copy of the NELMA (whatever the grading agency is for that particular species) manual and use their grading rules to ascertain whether a timber is of a higher grade than #2 (they have all sorts of pictures in the ones I've seen). When you do this, you run the risk of someone rejecting your grading (since you are not a certified grader), which means you have to go back to the lowest grade in that category.
Typically, a #2 timber isn't overly attractive; it would get rejected for visual reasons before it would get rejected for structural reasons.
Looking through the NDS supplement for other design values, it appears a #2 grade for other species is around 54% of the SS value for FB, and 80% for E. It would be reasonable to make similiar reductions to cherry.
