"... lazy people should be send to the East(front)...

[Graham Boak]

In the RAF personnel judged "LMF" could indeed receive some kind of punishment, usually including demotion and probably transfer to some fairly demeaning duties. This would however be within the RAF. He would not be transferred to some other branch of the armed services, or placed into a combat environment. This would have been judged detrimental to the fighting abilities of any recipient unit. You may be misjudging the term "grounded". This simply means being removed from flying duties, and could be for several reasons other than LMF.