This is a win-win-win and in my opinion there is no moral delimna. If it is against AA rules, you're still doing them a favor by pulling this off.

1. The airline (AA) gets $1200 cash that they would not otherwise receive.
2. Your grandparents get where they need to go in a timely manner.
3. You get an award.

Is it against the rules? Maybe, but probably not. But even if it were, let's look at the difference between this and "traditional" reward sales.

In a traditional sale, you give someone, say $900 for enough miles for an AA ticket that would otherwise cost $1200. AA losses $1200 (since it's likely that if they needed to go that badly, they would have paid up), and the owner of the miles pockets $300.

In your example, the owner of the miles (your grandparents) pockets nothing, the airline gains $1200 (since that cash would otherwise have been spent on the other airline) and the airline incurrs the same cost of the miles being burned as in the "traditional" sale.

Now that I look at my analysis of your example, I'm not sure I see how this could be interpreted as against the rules... All of the money you contribute will be going to AA, not your grandparents. As you will not be paying your grandparents any consideration for the miles, I'm not sure how it could be characterized as a barter or sale.