"So then I am ignoring the 1099G. Will this cause future issues?"
Not as long as the Sched C is reporting enough gross revenue to cover this additional business income. It's the same with 1099-NEC; you don't input and report them. You report All Business Revenue.
That grant was given to the person's business; not to them personally.
"Level Up" is a gaming function, not a real life function.