Justine, what a gift that you could be with DH's grandfather in spirit as he made his sacred journey from this world. I too don't believe there is any such thing as coincidences, the timing of his passing does seem significant. I'm sure your new little niece has plenty of spirit with her, helping her to seize hold of this lifetime. One day you will be able to tell her the story of the week she was born, and it may help her to follow the path she has chosen to come into the world for.

Robert Moss has a whole series of books on dreaming & states of consciousness which you might find interesting reading.