A controlled substance is anything listed in the Controlled Substances Act. This is Title 21 United States Code (USC) Section 812.
And yes, marijuana IS a controlled substance. It is listed in Schedule I (C)(10), in the controlled substances act. Schedule I substances had no accepted medical use under this act. They are illegal to use under any circumstances.
Although some states may have allowed "medical marijuana", this is a violation of the Controlled Substance Act. States that allow this are in violation of Federal Law.
Although alcohol is not listed as a controlled substance, every state has laws about driving under the influence. These laws cover being under the influence of alcohol and/or any controlled substance.
The case was probably closed because as a grandparent you really don't have a legal right to visitation. Attorneys do not usually bother with such cases. That is the reason the judge ruled in favor of the mother.
If the child is truly being abused or neglected, continue to report them to Child Protective Services.
To report child abuse in Philadelphia- 215-683-6100