This doesn't seem to be about Christmas arrangements but more to do with controlling who the ex-wife can introduce his children to. The short answer is he can't. Unless there are safety reasons, when your DD has the children, it is up to her who they see. Equally, when your SIL has them, she has no say. He could introduce them to a different woman each time he had them but unless the children were adversely affected there is nothing she can do.
This is something that women often use to avoid giving the Father access and use all sorts of "rules" to control the situation. The courts do not allow this but, often, men don't realise this. Now, it may be that it might be comforting for the absent parent to get to know the people in their children's life but it isn't an absolute right. Your daughter, assuming she is a responsible parent, will be deemed by the court to be able to make the right decisions for the children and the same for the father. There are a few areas where both parents are expected to come to an agreement about like the school children will attend and if they can't, the Court will make the decision.