Where do you live ? if it is down south maybe an outside park party ? If up north do yo know anyone with a community center or hall they can use ?
I also understand how she feels and it is natural to want to give the child everything and how hard it can be-- can she make her anything ? I know time is at a premium for her right now - but even if she got her , her first baby doll and maybe made a quilt for the doll ? then as she gets more time she can make a quilt for your DGD to match the doll quilt