I would take your collie out of the way when your grandson is around. When I was a kid my auntie used to have a collie and whenever we visited she put the dog away in another room.
Your dog is obviously showing that he is uncomfortable around your grandson (at that age kids do not understand and are fascinated with dogs), I would not let them be around each other much more unless under VERY close supervision. The dog has only one other way of saying he is not happy, if he cannot get away what choice are you leaving him but to use his teeth?
I put my dog in my bedroom upstairs when I had a granddaughter visit, the little minx found that if she rattled the dogs lead then the dog would come to the top of the stairs!! She tries to get near the dog at every oportunity, so SHE has to be watched at all times - I trust my dog totally, but I NEVER trust children.
Please don't test your dog anymore, he has shown you he is not happy and if the child falls on him or torments him like I say the dog will use his teeth - it is his last defence. Then you will be left with one option and your grandson will probably be scarred for life. It really is not worth it.
Please put your dog somewhere that he can snooze happily when you have a visit from your grandson, then everyone can relax and enjoy the visit.