DLPB, you can ignore my following post.
'Good Chocobo', 'Great Chocobo', and 'Wonderful Chocobo' are not titles and are incorrect any way you slice it (if it were 'Choco the Great' it would be a different story), the others are debatable (in which your opinion is wrong )
the reason i brought this up in the first place is because when you talk to chole and get the notes it actually gets a bit ridiculous IMO, "Breed the Good Chocobo with Great Chocobo with the Carob Nut and you get Mountain Chocobo and River Chocobo, breed those two and you get a Mountain and River Chocobo in the Backyard with the Shovel and the Huge Materia"
I could not disagree with this more. Maybe title isn't the correct word. Think of them as classifications or ratings. It's not just a good chocobo, it is a chocobo that is rated as 'Good'. Therefore, this chocobo is classed as 'Good Chocobo'. Or this chocobo is rated to be able to cross rivers, therefore it is given the 'River Chocobo' classification.
In that sense, the sentence that you posted reads perfectly fine. "Breed the Good Chocobo with the Great Chocobo..." means that you need to breed a chocobo with a Good rating with a chocobo scored as Great. It's not some squishy feeling of 'well I think this looks like a pretty good chocobo' that would confuse a new player, it's a rank the chocobo must be at.
I could see an argument to not capitalize the word chocobo (I wouldn't agree with it, but I would understand it). But I cannot see the logic in not capitalizing the rating of the chocobo.