Hmm tricky one
The relatives in question would be half-brothers / half-sisters of your parents. Effectively half-aunts and half-uncles.
This is a very grey area. To be fair, the exact wording MIGHT seem to indicate they would be eligible since it say "child of a grandparent", which they certainly are, but then again in brackets it says (aunt or uncle) which they are not, they are half-aunts, half-uncles.
Please note however you must be able to prove via birth certificates etc that this man was your grandfather, also prove by birth certificates that his children are his children (hence proving these are related to you), and finally you must prove that these children are Canadian citizens or permanent residents and are still living in Canada.
Sharing the same surname will not be sufficient proof.
http://www.cic.gc.ca/english/immigrate/skilled/factor-adaptability.asp
Relatives in Canada
You, or, if it applies, your spouse or common-law partner, have a relative, either a
parent,
grandparent,
child,
grandchild,
child of a parent (sibling),
child of a grandparent (aunt or uncle), or
grandchild of a parent (niece or nephew), who is
living in Canada
18 years or older and
a Canadian citizen or permanent resident.