Etiquette does not require that a host provide transportation to an event.
However, family feeling might.
In my case, when I invite someone who is elderly and who might feel that asking for transportation would be an imposition, I figure out ahead of time who might be available to drive them. Then I include in the invitation, "If you need a ride, please let me know. Tom/Sue/Bill will be happy to pick you up." Mostly, I do this because I know my elderly relatives and know that they wouldn't dream of asking for a ride and they really aren't up to taking public transportation at their ages. And I want them there.
But for someone who isn't ill/infirm/elderly, I leave it up to them to figure out how to get to my house. They have more options--calling a cab, taking public transportation, asking a friend for a lift, asking a family member for a lift. I still want them there, but expect them to be able to figure out how to get where they need to be on their own.
We recently had a family party. Aunt Alice was told, "If your kids can't give you a ride, Bill or Sam can. Just let us know." But the younger cousins just out of college, who don't have their own cars yet, were just invited. It was up to them to call their parents/siblings/other cousins to figure out the logistics.
RubyCat, I see your dilemma is made worse because your DD and Grandfather live in the same building. It's hard to pick up one of them without giving a ride to the other.
In your case, I don't think I would offer rides. It would be just too much time out of your day. And you'd probably have to pick them up fairly early, so you could get home to cook and do the other prep, and then you'd have two extra people hanging around the house, possibly getting in your way as you try to get everything ready.
So, in your shoes, I'd probably arrange a ride for Grandfather, with Oldest Daughter, if that works. Then I'd either tell Youngest Daughter she's on her own, or, most likely, I'd offer to pay her bus fare. Depends on how much you want her there.
And if Youngest Daughter finds out Grandfather is getting a ride and she isn't, I'd point out why--her behavior is such that her own sister doesn't want to give her a ride. Give her something to think about as she takes the bus back and forth.