I don't think what they are asking from you and your sister is unreasonable. You stated that they don't want to babysit all the time. To me, that sounds like they are willing to watch their grandchildren for a few hours every once in a while. At least that gives you a chance to go our for an evening alone or something like that. There should never be an expectation for the grandparents to spoil their grandchildren. My grandparents would let me have cookies when my parents weren't looking but never gave me anything for good behaviour, it was just expected.
Basically, as long as they are willing to be loving grandparents and not competely shutting out their grandchildren, your sister should respect your parents wishes. Your parents need to stand their ground.
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A little rudeness and disrespect can elevate a meaningless interaction to a battle of wills and add drama to an otherwise dull day. Calvin
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