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In order to address the issue of custody, your daughter will need to file a motion to set aside the temporary custody order and ask the court to grant her custody of the child now that she is out of jail with all charges being dropped.
The court can order a hearing to review the situation and determine what is best for the child and either order the child back to the mother or either to keep the temporary order in place.
Generally, this matter turns on whether it is in the child's best interest to remain with the grandparents or to be reunited with the mother. The court will look at the character of the parties, the home environment, the preference of the child, and anything else that is relevant to the situation.