I too sale many of my handmade items at craft/fair/art shows. I always follow the basic rule of materials x3 and have many return customers because of the fair price on quality merchandise.
Then for my family members they have all received things that I have made for them as gifts, never asking for payment. In our family it is understood that it comes back with time to the one that original made it. As in many families, we all give to each other when the needs arise.
But I will add this in, one of my quilts was priced as I mentioned at materials x3 and the customer was so taken with it that she actually paid me twice the amount that I was asking and told me I don't charge enough for all I do with my quilts. That alone was payment enough for me. It's so special when quality is recognized. So ladies & gentlemen if you take pride in your work and it shows there are those out there that do appreciate it.
I say the "borrow" arrangement is the way to go with grandma's quilt. Be sure to label it properly, so in time it will be returned to you.