Oh my... I know I would be feeling pretty sensitive if I heard/read/knew one of my cubs was calling someone else "mom"... I think it's normal to feel a pang about that
I guess it would make more sense if this woman had been in their lives since they were small children and had, had any hand in raising them, but that isn't the case. Did your eldest DD start calling his gf mom after you went no contact? I know she has mental health issues so it's pretty futile to try and figure out her reasonings.
On the holiday issue. I don't have any grandbabies yet... but when(if) I do, if I get invited to spend Christmas with my child, their spouse and baby I would definitely change any preexisting plans I had so I could be there. Christmas has pretty much lost its magic to me over the last several years, I think spending it with a precious child would bring a lot of that back. They are only small for such a short while, I wouldn't want to miss out on that. Like Dandy said, any mature adult is going to understand you wanting to spend Christmas day with your grandchild... and son, especially if they know the obstacles you've faced along the way with your kids.
Mumma hugs for you Amy!