I say Grandparents' choice. I had three grandads and four grandmas growing up (great-grandparents, we never bothered with the great all the time). Easy: use the last names. Grandma and Grandad N, Grandma B, Grandma and Grandad H, and Grandma and Grandad M.

Mum decided to be Grandma B, as we knew Dad's Grandma B well, even though she admitted a year later she wanted to be Nanna. PiL were Grandma and Grandad anyway, but DS calls my parents Ninna (short for Nanna Ninni - Ninny being a pet name from her little bother) and Lan-Lan (I don't understand that one either). We just use last names when talking about grandparents (or unusual pet names). I was never confused and DS doesn't seem to be either. I'm going to be Granny when I have grandchildren, stuff what DS/DiL/DS's PiLs want.

If your DH is confused by it, suggest he grows up and gets the mentality of a toddler.

I mean, what on earth will he do if there's another child in the school with the same first name as your child?