OP, I assume your daughter and son in law work in hospitality or the entertainment sector and their busy periods are summer and perhaps Christmas?
Either way, this is unsustainable and a wrap around childcare plan must be put in place for the children. Wrap around childcare is a way of life for working parents these days, with granny helping out maybe a couple of days a month (if she agrees) and in genuine emergencies.
Have they looked at hiring an nanny. Don't be alarmed, I know this sounds like the sort of thing wealthy people do but it really isn't. I know ordinary mums who have a "nanny". Could you and your DH possibly help towards the costs for this? I'm not suggesting you have any obligation to do so of course but it may be preferable to the current situation.
Why isn't the 2 year old at nursery? I believe there are up to 30 free hours available under a government scheme. It would benefit the child greatly to go but of course your daughter would still have to take the child and pick them up. Are there any childminders in the area?
Alternatively either your daughter or son in law will have to give up work and top up with Universal Credit or, more realistically, change their line of work completely to fit around the children. So, for example, your daughter works the night shift and your son works during the day. This is what most working parents do these days. It is a juggling act and a headache but they chose to have 2 children and it is their responsibility to cut their cloth accordingly. Not yours.
Ultimately you will make yourself ill and your daughter will have to find an alternative, possibly at short notice.