Good news: Grandma's stomach cancer seems to be localized only to her stomach so far.
Bad news: She's going to have to have 90% of her stomach removed.
Stomach cancer typically doesn't respond to chemo (the best way to describe it is that it just gives a big middle finger to chemo and keeps replicating), so the fact that it has spread yet is very good news.
Overall this is better news than the initial shock of it all. She's a trooper. She'll do fine.