I would advise you to speak with this boys parents about his behavior and the way he has been raised. He may be copying what he sees at home. Some children experience anxiety issues when they are brought up in a violent home. Is there a chance of you or somebody taking him out of the home for a few days a week by himself to have some one on one attention? And I would suggest doing the same with his sister for one on one attention. These parents need to be told to straighten up their behavior before they loose their kids to someone else. Or before their kids get old enough to live like this themselves. These kids do not deserve to live in these kinds of conditions. This is where I would start. While these children are visiting your home, you can instill proper behavior and values while under your care. Teach them right from wrong and they will always respect you for this. Good luck.
I'm a strong believer in genetically inherited personalities, and your daughter and son in law sound like your grandson.
They have passed down their difficult personalities onto their son.