The M1A1 is by no means the most advanced tank in the world, and certantly not the most advanced in the U.S Army. There is a reason why there is both an A1 and an A2 in service.
What's most strange is that they never acurately state what sort of rifle it was. It could have been anything. Plus, that looks to be a pretty soft spot on the M1's armor. But in all, I consider this claim somewhat doubtful. Even IF that was a 'rifle' round, how did it keep the kenetic energy to keep bouncing around inside the tank like it did and (quite suspiciously) was able to take out some of the crucial systems? On top of that, the 'round' seems to vary in dimension and shape rapidly. Even if it did fragment, a standard rifle round probably would not have been big enough to create a 1-2 inch hole. And the final question is: Where is the round? The round it's self is the biggest peice of evidence and that it's self is missing completely.
I smell a Magic Bullet.
The only sort of round I can even come close to would be an anti-material round of some sort or a lucky peice of shrapnel.
Again, one must remember that the M1A1 is not the most advanced peice of machinery by far. French and German tanks have proven to be better in certian areas than the M1.
This also reminds me of the 'Farmers Rifle V.S. Apache', which probably went down to something entirely unrelated.
I am no expert, so if someone else has a better explanation, by all means.