I have seen this problem first hand in both my best friend's daughter, and my nephew. Both were told the same thing about there is nothing wrong, not to worry.
DO worry. The child needs a paediatrition asap. If you see a GP, they will keep telling you the same thing. My nephew's parents are separated and that is why they, too, didn't get help til he was 6. For your grandson, his parents can expect major changes if put on the proper meds in a relatively short period of time. "My" kids needed to re-train their bowels as the bowel went back into shape. But it did give them the tool they needed to succeed and that increased their self-esteem ten-fold.
Good luck with this. I am amazed at how often this is happening and how little information is out there.
It is important not to underestimate the impact of constipation - it is the single most important factor in encopresis at this age. When the doctor says there is nothing physically wrong, he likely means that, from a structural point of view, there is no abnormality in the intestinal tract. However, serious constipation can result in impacted bowels, and this requires medical treatment. It is likely what is occurring with your grandson.