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Should be split in half between the two daughters.
No - is the money meant to enrich the daughters primarily or the grandchildren? Did the daughters decide on the size of their families with the size of a possible inheritance in mind? Doubtful - the one with more kids didn't have more kids to "bilk" mom - though perhaps that is what the other daughter thinks.
Likely grandma figured the grown daughters are doing fine and wanted to "remember" them with something but the real intention was to help out the grandkids and give them a good start in life so she divided it all equally and to heck with whose "family" got more. How silly is that?! "Oh my, that silly broodmare of a sister just 'stole' a bunch of money from 'my family'!". How greedy that sounds.
Inheritances are nasty, divisive issues that inevitably lead to pain and pitting families against each other. Either don't leave any money to anyone, or, be very open and upfront about it all before the death of the person.
Here is my example. My husband's grandfather (who was moderately wealthy) died many years ago and left everything to his wife and nothing to his children or grandchildren. So far, so good, and it was accepted by the family.
His wife at that time was his second wife (his first wife, my husband's paternal grandmother, had been tragically killed in an auto accident when my husband's father was a young man). My husband's father got on well with his step mother and there never appeared to be any ill-will. She (the step-grandmother) always treated my husband as if he was a biological grandchild (and I, once I had come onto the scene). The step-grandmother had 3 children from her previous marriage, and then there was another child born after the marriage.
Still following?
The step-grandmother lived frugally and unbeknownst to everyone, had been very wisely investing the money she had inherited from her (2nd) husband. She died several years ago. She left a small fortune in her will. Not enough to make anyone independently wealthy. But, enough to make considerable dents in mortgage payments etc. She massively favored her biological children and grandchildren over her step-child and step-grandchildren. My husband's father has felt very bitter about this ever since and it will probably stay with him till his own death. It didn't really affect my husband one way or the other. He didn't really know his grandfather as he died when he was very young. So, he saw the money as being his step-grandmother's (he always referred to her as grandmother, i'm just using the 'step' part to make it clear). But his father sees it as his father's money, that he was entitled to.
Not sure if this adds anything to the discussion or is a separate issue or a distraction. I just wanted to add it to give my example of an inheritance and the ensuing fallout from it. Feel free to ignore!
"Oh my, that silly broodmare of a sister just 'stole' a bunch of money from 'my family'!". How greedy that sounds.
Yes it does...and it extends beyond the realm of family money. Consider the urban not-quite-myths about using kids to milk Welfare and other societal handouts, the AK Permanent Fund Dividend, etc.
Interesting. Now what if the daughters had passed previously, and only the grandchildren survived the grandmother? In your system of fairness, should one grandchild receive $150k all to themselves, while the other four are left with $37k each?
Yes and i'm sure these sister did not become successful all by their lonesome.
Between birth and adulthood MOST parents drop hundreds of thousands of dollars on their kids. Not even talking about college tuition.
So in no way can these sister all of a sudden cry "woe is me"
There are different ways to look at it the situation. You can look at it as two families, or you can look at it as seven individuals. I don't think either option is more valid than the other. Now, by taking the parents out of the example, I'm hoping that it makes it easier to consider the children as individuals.
From grandma's perspective, she might have her own special one-to-one relationship with each grandchild, not just a second-degree association through the parent. Each grandchild is someone that she loves separately, and each grandchild is someone she wants to take care of... equally.
Inheritances are nasty, divisive issues that inevitably lead to pain and pitting families against each other. Either don't leave any money to anyone, or, be very open and upfront about it all before the death of the person.
Here is my example. My husband's grandfather (who was moderately wealthy) died many years ago and left everything to his wife and nothing to his children or grandchildren. So far, so good, and it was accepted by the family.
His wife at that time was his second wife (his first wife, my husband's paternal grandmother, had been tragically killed in an auto accident when my husband's father was a young man). My husband's father got on well with his step mother and there never appeared to be any ill-will. She (the step-grandmother) always treated my husband as if he was a biological grandchild (and I, once I had come onto the scene). The step-grandmother had 3 children from her previous marriage, and then there was another child born after the marriage.
Still following?
The step-grandmother lived frugally and unbeknownst to everyone, had been very wisely investing the money she had inherited from her (2nd) husband. She died several years ago. She left a small fortune in her will. Not enough to make anyone independently wealthy. But, enough to make considerable dents in mortgage payments etc. She massively favored her biological children and grandchildren over her step-child and step-grandchildren. My husband's father has felt very bitter about this ever since and it will probably stay with him till his own death. It didn't really affect my husband one way or the other. He didn't really know his grandfather as he died when he was very young. So, he saw the money as being his step-grandmother's (he always referred to her as grandmother, i'm just using the 'step' part to make it clear). But his father sees it as his father's money, that he was entitled to.
Not sure if this adds anything to the discussion or is a separate issue or a distraction. I just wanted to add it to give my example of an inheritance and the ensuing fallout from it. Feel free to ignore!
This happens a lot. Parent remarries leaves everything to new wife/husband, original kids get less $$$/ or nothing.
Could grandpa have stipulated in is will when he 2nd wife dies money reverts back to his kids and his biological kid with 2nd wife and none to 2nd wife’s biological children?
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Doubtful - the one with more kids didn't have more kids to "bilk" mom - though perhaps that is what the other daughter thinks. 
