Okay, now that I've already posted a true but nonetheless unhelpful response to you, I'll also add something helpful:
Your family is not ruined. That is wildly overdramatic.
There are other possibilities and ways to see this:
Your son-in-law could be a manipulative liar who is playing you like a fiddle.
He might have wanted her to do the porn.
Doing porn isn't even wrong anyway.
And selling panties? Pshhh. That's just selling old clothes to suckers with a fetish.
Your grandbabies might be upset because of the natural strife, but you have no way of knowing the nuances of that marital strife. Nor do the kids, really.
Maybe your son-in-law really has abused your daughter, and the grandkids will grow up thinking abuse is fine if your daughter decides to stay.
Maybe your son-in-law is poisoning then against their mother.
Maybe he's treating them poorly when you're not around.
Maybe this other guy treats your daughter with kindness.
You need to get something straight: you cannot win by siding with your son-in-law and acting like your daughter is a bad apple. You don't care if she's happy. You care that she be happy your way.
And that's not real love.
Here's what you do:
Stop consulting with your son-in-law for God's sake. Get it through your brain that just because you and he want the same thing, he may still be a jerk. And then go to your daughter and apologize profusely for essentially joining his campaign against her. Listen to her. Understand that your age and experience and the fact that you raised her do NOT mean you automatically know what's best. Continue to be a living grandparent, but don't you dare undermine your daughter because you feel sure you know best.
Even if your daughter does decide she fucked up here, she will not forget that you teamed up against her and then claimed it was out of love.
And if she never comes around to your side?
If you don't quit the nonsense with being a third person in their marriage, you may just end up estranged from her while she goes on to live a happy life.
Again: Your family isn't ruined. If you shape up now, things will be fine eventually.