Dale great story and even better pics! I have had a similar experience with my "niece" Jessie, also a yorkie and Posh.
My brother and his wife have a six year old princess yorkie who I think truly doesn't know she's a dog. Every time I go to visit them with Posh, or they come here, it is an extended stay as my brother is an F-16 pilot and there aren't too many bases in MN
! Posh always wants to play and Jessie just doesn't want anything to do with her, there is a lot of "bitching" going on and Posh just keeps coming back for more.
Well, this last time Jessie visited on her way to a big move to Japan, my SIL and Jessie were here for almost three weeks. After about three days they really settled into their own type of "friendship" and sometimes in her own terrier way Jessie even played, sort of, with Posh. We humans just let them work it out. My SIL and I wanted to do something fun and dog friendly so we went to a "dog party" called the Yip Yap Club. Jessie and Posh were outnumbered by six chihuahuas and I thinking they were like "what the hell?" Jessie was always keeping an eye on her cousin and each time another dog tried to play with Posh or check her out, Jessie was right there to make sure Posh was safe. It was so cute.
So, I'm sure your yorkie grandbaby won't ever play in his way, with Cicero, but will do so on her terms, in her own way. She is a doll!
Here are some pics that we forced Jessie and Posh to take together.