Reader's Digest (yes, they of the Condensed Books) put together a two volume anthology of The World's Best Fairy Tales, originally in 1967, though the copy sitting around my house was almost definitely the 1977 edition. My hazy recollections from library school are that the 1960s were a boom time for folklore anthologies for children, with an emphasis on collections of tales from one country, region, or culture. Reader's Digest was probably going along with that trend when they snagged a bunch of stories from the Andrew Lang colored fairy books, and then added in some Andersen and some Grimm and a smattering of other things. The pictures were by Fritz Kredel again.
I tend to think I didn't have much exposure to the Andrew Lang collections as a kid, and it's true, I didn't read the colored fairy books directly, but I read a number of stories from them via Reader's Digest, and enjoyed them very much. Since Lang did his anthologizing in the later 1800 and early 1900s, and there was a surge of interest in comparative folklore for children in the U.S. in the 1960s, I'm tempted to believe this sort of thing is cyclical. If so, I hope that we're ready for a new upswing of interest in folklore from cultures around the world, perhaps this time with a bit less bowlderization and more of the original content and context. My sense from watching library collections get weeded is that many of the 1960s era collections of folklore and fairy tales from many lands have been pulled from general collections. They were older, and didn't circulate well. I'd love to see something new and stunning take their place.
In the meantime, if you don't happen to stumble on a copy of the Reader's digest collection in a thrift store somewhere, and want to read the stories online, I enjoyed the Bronze Ring (from the Blue Fairy Book), Five Wise Words (from the Olive Fairy Book), and The Boy Who Kept a Secret and the Colony of Cats (from the Crimson Fairy Book).