I can't think of anything I would have loved better than to be taken shopping by a grandmother.
This is what I'd probably do:
Decide on a budget.
Halve it.
Say that your granddaughter can choose anything she likes with her half. (clothes, naff jewelry, hair stuff etc. - it will probably all be dire anyway - grin and bear it)
Tell her that the other half is for you to choose (probably) more practical/sensible clothing.
This way, you'll both have a great time shopping.
Enjoy.
The jeans sound great by the way. 