(My friend and I were visiting her granddad (who I haven't met before). Other guests include my friend's aunt and her two year old daughter. We are just discussing about how long kids should keep their pacifiers.) Granddad: In a few years she'll suck on something completely different. Everybody: GRANDDAD! Granddad: What, I meant her thumb!
(I had wrapped a bottle of wine to give to my grandfather as a Christmas Present) Me: Merry Christmas, Grandad! Grandad: (without opening it) Oh, lovely! A jumbo size pack of condoms! Just what I needed! Grandmother: That's an oddly shaped box of condoms... Grandad: (pointing to his crotch) Hey, they haven't seen the shape of this yet!