Neighbor Drama

How would u all handle this? My neighbors Mom lives with her and her 6yr old daughter. A few months ago the Grandma came to my house and told me that my 7yr old daughter is "mean and 2 faced" She said this because my daughter will go over and ask the grandaughter to play outside,then eventually all the neighborhood kids come out and my daughter will play with them. The Granddaughter gets her feelings hurt and cries and goes inside. So apparently that makes my daughter 2faced. So the grandma told me to not have my daughter knock on her door anymore to play. Ok,thats fine. Fast forward a few months all the kids are outside playing,the granddaughter gets hurt and my daughter runs to her to see if she is ok. The Grandma saw this ,walked over to my daughter and told her "Youre not a good friend because u shpuld have told me she got hurt". My daughter came inside crying...Few! Ok, a few days ago the Grandmother came to my house AGAIN,very angry and upset demanding that my daughter stops telling scary stories because now her granddaughter refuses to play outside. The "scary" stories my daughter told her is what the schools are teaching the kids right now. Their teaching the kids that since its cooling off the coyotes are getting closer into the neighborhoods. My daughter was just teaching her granddaughter what she learned in school. I explained that to the Grandma and she said "No,your daughter found my grandaughters weak point and she is purposly scaring her"... Apparently before the Grandma came to my house she approached my daughter and the others kids at the park upsetting them. The grandmother has confronted atleast 3 other famlies and have told them off about their kids too. Now,the last few days when the kids are playing outside and her granddaughter walks out all the parents bring their kids in. We dont want our kids keep getting in trouble with her and im tired of her approaching my daughter and then knocking on my door. Ive never had complaints about my daughter being mean,not once. I just feel like the grandma is waaaay to over protective.What do I do? Keep letting my daughter play with her grand daughter or just bring her inside everytime she goes outside?