To be pedantic: I think the actual story is about V1 drones. They did not have a navigation system as such, they were just aimed in a certain direction and with the right amount of fuel to fall out of the sky over the target.
The British noticed that V1s aimed at London tended to fall a little short. This would have been to the South and East of London since that's the direction they were coming from. They reported more hits on the North West of the city, expecting correctly that Nazi spies in Britain would let the Luftwaffe know about this.
So the range was decremented further, meaning even more hits on the southern and eastern suburbs, but statistically fewer people killed and buildings destroyed as the mean moved to less populated areas.
