I can't believe your GD would treat such a beautiful quilt that way! There are still a number of quilts in my family from my great grandmother, and while they are in need of a little repair, every one of them is loved, cherished, and used in the manner it was meant for every winter.
I remember though, before I started quilting, my aunt gave me a quilted pot holder for Christmas the first year I was married. I was quite dissappointed, because it seemed like there wasn't much thought or effort that went into the gift. Now, I'm finishing up placemats and such for my own family and I know exactly how much work goes into such a thing. And that potholder that I didn't appreciate much on opening now gets used in my kitchen at least twice a week!
I think a little education is the key to proper appreciation. Invite your GD or even your grandson's fiancee over for some girls time while you're working on basting a quilt sometime. (I always found that to be the hardest part of making a quilt.) Maybe if they see the amount of care that goes into the creation, they would appreciate the thought just a little more. And I would definately say something, not only to your GD, but to her parents as well, about how seeing the quilt you made so disregarded made you feel. You can say that once you gift it its no longer yours all you want, but its always easier to say that when it's not family you've gifted it to. If nothing else, they should care about you enough to treat things you gave them properly. I'm sorry if that's a little coarse, but it's true.
If you feel that your grandson's fiancee would appreciate it, make her a quilt. When you give it to her, you can let her know it's a welcome to the family gift. Don't let one person's thoughtless actions rule what you do for the rest of your life.
Sloan
P.S. I've noticed the boys tend to be closer to their grandmothers than girls are many times, so maybe your grandson would be a good influence in making sure your gift would be taken care of too!