I worry she has no playmates

Foxglove77 you could try warning your DD that if DGD picks up the bugs now and builds her immunity up she will probably catch less things when she starts primary school. There are so many benefits to getting things over earlier, not missing school work being one of them. As for passing on bugs if you see a child at a playgroup with a cold and your DGD is playing with them you could alert your DD and she could take appropriate measures to prevent them getting it. My DIL has a job which is impossible to do with any cold etc. She has substantial and time consuming processes when her children have colds. They are tedious but seem to work. They include only using a tissue once, always washing your hands or using hand gel after wiping a nose and loads of other things

This is quite usual once children start nursery or school. Like MOnica I'm puzzled by the parents job restrictions. It's a shame for your granddaughter to miss out on socialising with other children Foxglove77 but its not critical at this stage.

I agree with other posters re importance of peer group company and building up immunity. When DGS started nursery he was permanently cold ridden. Being asthmatic too, it was a problem. However GP said he’d had the same problem with his twins, taken them out of nursery to be looked after by grandparents, only to have the same perpetual cold problem when they started school. In this case they missed valuable learning time too. So DGS carried on at nursery and had a robust immune system in time to start school.
Children get minor illnesses, I’m afraid it’s part of the process and isolation is not a good solution imho.

Yes, I am puzzled by this Their jobs are safety critical and they cannot take any form of meds. They also stand to lose attendance allowance if they have any time off.

If that is the case it probably break all kinds of employment law. If they want to stay infection free, then they shouldn't have had a child.

I had an under 5 life with just a younger sister for company, no other children around until I started school and I think this has contributed to me feeling constantly on the edge of the crowd ever since. Their child's psychological development is as important as her health and physical care and they really need to rethink this ban.

It always happens as soon as they start at nursery or playgroup, the colds etc but it does build up their immunity which stands them in good stead for when they start school.

I don't understand about her parents not taking medication or losing attendance allowance but it seems a shame not to allow her to mix with other toddlers, particularly as she doesn't have contact with other children in her daily life.

It’s going to have to happen now or in the future that she is going to pick up everything till her immune system builds up, it does seem sad that she has to be friendless.
I would discuss your concerns with your daughter and point out what’s been said here.

I think it is unreasonable of any parent to expect that their child will not catch colds, tummy bugs etc. That is the norm as they grow up and become more immune to the infections. If she doesn't get them now she will certainly spend a lot of time off school when she is five.

However, she is clearly a friendly, happy child as she enjoyed the play groups, so I am sure she will remain so even if she is prevented from attending.

It is ultimately down to the parents to prioritise matters how they wish. I'm unclear what jobs prevent you from taking a paracetamol - which is all you might need for a common cold.

It is a thought but did your DD and her partner get the cold the second time?
We used to call them snot transfusions. yuck!
Some folk wont travel on public transport due to catching colds and I must say I hate listening to the orchestra of coughs but we all must build resistence.
Could you childmind for one other on a day when you are caring for your DGC?

Hi, kids seem to have constant colds and bugs at that age but in some cases it is good as it supposedly makes immunity stronger. My dd loved going to nursery to play games and have fun and it also prepares you for school. Sadly you can't avoid germs and if she doesn't catch colds now...wait until school starts! Obviously you have to respect your dd's wishes and she may change her mind given time - don't worry she is lucky to have a loving grandmother to play with.