The article repeats the urban myth:

    The origin of the word bug as
    it pertains to engineering goes
    all the way back to 1947 when
    Dr. Grace Hopper discovered a
    moth stuck in one of the relays
    of the Mark II computer.

It goes back further than that - there's a cartoon from the 1930s in which a prospective car buyer lifts the bonnet/hood and some moths fly out, with the voice-over saying "The engine still has a few bugs to be worked out."