It's a difficult thing in such situations. You have to take care of yourself. If there is tremendous stress
and conflict, and you are not getting the support you need, it is wearing you down. You are the grandmother and as the grandmother you want the interaction to be much more carefree, relaxed, and positive. If you are warn out, stressed out, not so sure you are up to the task of being anything to anyone.
The challenges you describe sound like they need to be handled more directly by the parents first. If you decide to step back as the sitter, you may be better able to support the family. It sounds like you are feeling overwhelmed. Put that back onto the parents to solve. You certainly can share your concerns, offer support, but stepping back may be the best thing for you.
There's no doubt about it- this is a very difficult situation that you see and understand quite well. However, it is up to the parents to first determine if there is a problem, and take the steps to make things better. If what you describe continues, the parents won't be able to negate and or ignore it. That little boy is trying to communicate something is not working- he's the little barometer.
Best of wishes on this one, taking care of yourself is important in all of this- so you can be the grandmother you want to be.