What can I do about this situation?

I understand your dillema, but let me tell you...your son will be in such awe of the red suit he probably won't "see" past it. Believe me I have seen lots of relatives and friends dress as santa and you would think the kids would know, but they don't. IF it should happen, just have a little reserve line in the back of your head. How you and your family choose to handle it is up to you. But me personally...would say..."Grandpa is Santa's helper" (he'll only be 1 1/2 and really any more info than that would be lost, if he even notices) Enjoy, the best is yet to come!!