Answer: Yes and yes. The students lost their housing due to an eviction (as well as substandard conditions–specifically, no electricity). They moved in with grandparents due to the loss of housing. The custody order does not change that. If the children are going to remain with grandparents long-term, and the housing is adequate for them, then the children may no longer be homeless. But the McKinney-Vento eligibility lasts for the duration of the school year.
As for transportation, the McKinney-Vento Act is clear that the district of residence and the district of origin share the responsibility for transportation. If an agreement about how to share costs is not reached, the law requires the costs to be split equally between the two districts.