LEGO is made out of a polymer known as ABS (acrylonitrile butadene styrene). This plastic is used not only in the manufacture of LEGO but also in the manufacture of children's dinnerware, especially drinking plastic cups. ABS plastic has been used since the 1950s and there are no strong cases proving that it is toxic or dangerous. Most pipes that are made of plastic in your home are also made from ABS plastic. It's widely used in hospitals for safety equipment, emergency wash centers, and has many other uses. The only time that ABS plastics can become unsafe is when they are melted down in liquid form, so as long as you don't start melting LEGO blocks than you will be okay.
As for when to introduce LEGO blocks to your grandchild, it will depend on the developmental stage that your grandchild is at. DUPLO blocks are made for the youngest LEGO fans, and they are recommended for children ages 1 1/2-3 years old. DUPLO blocks are larger than traditional LEGO blocks. By age 4, your grandchild can play with Larger Bricks manufactured by LEGO. They are smaller than DUPLO but larger than LEGO bricks and help the child make the transition. Generally by age 5, children are ready for the classic sized (regular sized) LEGO bricks. By age 6, children are ready for the systems LEGO bricks that encompass all of the neat themed sets associated with LEGO.
I appraise toys. Former educator.