First of all, are your grandchildren hurting or playing agressively with the dog? If so, that's why the dog is being aggressive. Can you keep the dog in a separate room when the grandkids are visiting? If not, most animal shelters have an animal behaviorist on staff that give free advice to help find solutions to problems like yours. They want to do everything possible to prevent pet owners from giving up their pets. Please look in your local yellow pages under "humane society" or "animal shelter" or go to http://www.petfinder.org
Please do not give up so easily on your dog, there may be an easy solution to this problem. Good luck & I pray you keep your dog.