I would have asked , very nicely, "what do you mean?" She may have been thinking of something else entirely or does not understand what it is you are making. Or not.

As I was told by my grandmother, a quilt has 3 layers; top, batting, and back. Nowhere have I ever read that a quilt could not use a panel. It was made with a grandmothers love. That is the thing to remember. Proudly give it to him and watch his eyes shine and that big broad smile grow on his face. And if you feel it necessary, maybe you should print the definition of the word quilt from Dictionary.com = –noun
1. a coverlet for a bed, made of two layers of fabric with some soft substance, as wool or down, between them and stitched in patterns or tufted through all thicknesses in order to prevent the filling from shifting.
2. anything quilted or resembling a quilt.
3. a bedspread or counterpane, esp. a thick one.
–verb (used with object)
5. to stitch together (two pieces of cloth and a soft interlining), usually in an ornamental pattern.

Try asking her what she meant. Maybe she is hinting for you to make a more adult, pieced one for him to cherish when he gets older and can use/display on his bed.
Personally, I must be the only one here and I don't mean to offend anyone, but I appreciate a pieced quilt much more than a panel. I know a lot more work goes into most all pieced than the panel although there are exceptions. I do feel panel quilts are good for children. They can have their favorite toons with them and yours sounds like it would be perfect for your grandson at this time.

I suppose she is not a quilter? It was a very unkind thing to say.
I think you are making him a great quilt and you really thought about that panel. He will love it and that's why you are making it.

I get what you are saying about pieced versus panel quilts, and I think you are correct in that I have a feeling the Mother wants a pieced quilt to be an heirloom for her son. However, I wouldn't be quick to spend the time, money, and energy it takes to a pieced quilt for a small child. That's just me though. Kids are tough on quilts and with all the washing that a quilt loved by a child will need, I'd hate to see all that wear and tear on a quilt that Grandma spent hours and hours on. My daughter has spilled juice, snacks, and even been sick on her quilt...I'm awful glad that it's just a bow tie quilt that I pieced together one evening from scraps!

I think the real hurt from comments like this from a family member is that when you are on the recieving end, in my humble opinion, you might want to accept a little more graciously when a gift has taken so much time and energy to create. Daughter probably didn't mean to hurt anyone's feelings here, but I can completey relate as I have a relative that I have made several quilts and about a half dozen wallhangings/runners for who still isn't pleased. After a while you kind of want to just say, "Hey, I'm the one making all this stuff, and you get what you get!" Complaints and critisisms can take the fun out of giving! ;)

Kids love panels with their favorite stuff on it. Just because mom doesn't care for tomater doesn't mean he doesn't. She was maybe thinking home decor/heirloom? You made it for a child not an adult. It is his quilt not hers!

Pay no attention to her comment. He will love it.

You will forget all about the hurt feelings when you se how much the little guy loves that quilt... and he will love it! Sorry she made you feel that way!
And putting the map on the back is brilliant and such a wonderful, thoughtful idea. I wish my mom had been a quilter and had made my kids quilts... I never would have complained. Don't worry cherrio, you did a great job!

I think you should be proud of it no matter what his mother says, its only his opinion that counts and the thought behind the world on the back is awesome! Would love to see a pic of it.

Thank you everyone for the supportive answers. This is maybe a stressed reaction to the baby due in feb and hubby deploying in may. That's what I'm going with.and I can't wait to give it to lil man