I have this horrible, hateful email written up and sitting in my drafts... When she said, "court order" it became about protecting my son and my Mama Bear came out.
My bio-dad (her XH) says that she's just barking and nothing will happen.
The thing is, she's secretary at a law office so I KNOW that she's probably been telling horrible stories (lies) about how we're "holding her grandson hostage" (a phrase she's used before).
I'm pretty sure that if your parents want to visit your town, stay in a hotel, and go to the park one day and maybe lunch another with your DH and their grandson - AT A TIME CONVENIENT TO YOUR DH - that is facilitating their relationship and they can't say you're holding your grandson hostage.
Maybe you don't have to let them see your son at all, I don't know, but I'm pretty sure that if you do have to, it can totally be on your terms because of the history and their current attitudes and the effect of their visits on you. You can take yourself totally out of it and you don't even have to see them, if your DH is willing to suffer through a visit to a park and a lunch with them and your son.
That way they can't pull their crap on you, but they do get to see your son and hopefully have a good time. And under no law that I know of do they have a right to "alone time" with their grandchild. Your DH can go wherever your DS goes.