There's no question that George Romney was on the side of the angels in the civil rights movement, along with many other Republicans (back when the GOP wasn't Dixie Central). There's also no question in my mind that his son lied about what he "saw":

A spokesperson for Mitt Romney now tells the Boston Phoenix that George W. Romney and Martin Luther King Jr. marched together in June, 1963 -- although possibly not on the same day or in the same city.

Romney, according to one piece of written source material provided by the campaign, made a “surprise” appearance at a small march in Grosse Pointe, Michigan, in late June -- several days after King led a much larger march in Detroit. Romney spokesperson Eric Fehrnstrom suggests that these two were part of the same “series” of events, co-sponsored by King and the NAACP, and is thus consistent with Romney’s claim that “I saw my father march with Martin Luther King.”

There really is a character issue here. Romney is at almost Clinton levels of deception. He has become so used to trying to say what people want to hear that he has lost all touch with actual reality.