If they wont give the child back then call the police. Unless there is some custody order giving them rights, they cannot keep the child.
Now that mom is dead, the grandparents may want some rights so they might file for custory as well. You need to see an attorney to see about signing over guardianship to your daughter, if you honestly feel your daughter can care for the child. So you have 2 daughters quite far apart in age I assume?
