I honestly wouldn't break the NC because of this situation, we had this a couple of years into our NC situation with my in-laws (we are now 6/7 years in) and very quickly found that they were using family bereavement as an opportunity to manipulate us and try to guilt trip us into allowing contact again. We instead chose to write a heartfelt sympathy card and posted it to the closest family member (apart from mil).
We have actually had to establish very strict boundaries as we were abused verbally and maliciously by several flying monkies who had been blindsided by mil (the narrative they told extended family, was so far from the truth, that it was practically a bestselling fictional novel) and decided to contact us on her behalf because there had been a family bereavement. It made an upsetting situation all the more upsetting. My DH made the decision not to attend the funeral, more because of the abuse he would clearly have received at the funeral (this was not what his Great Aunt would have wanted and out of respect for her we felt that it would have been unfair for us to attend her funeral).
We have unfortunately been in this situation once more and it was a repeat. A spouse of a relative (who DH had met only a handful of times) was very sadly dying of cancer and mil contacted DH saying that he needed to call his relative. My DH contacted this relative and was subjected to a full onslaught of abuse about our behaviour and how we needed to let inlaws back in and what a terrible person my DH was and how they used to think he was such a kind boy, what happened ....etc. DH was very upset and we were forced to get stronger with our boundaries.
DH ended up calling his parents and telling them that whilst he was very sorry to hear of the loss of their relative, that nothing had in fact changed in our personal situation. So no, contact would not be restarted. Unfortunately, the lies of my in-laws have put us in the situation that we are unable to have contact with several members of dh's Mothers family. There is too much been said and my DH's presence would cause an uproar and that would be disrespectful to the relatives who have passed away. We have decided that whilst we will decide on a case by case basis, there is going to be no benefit to anyone of DH attending any funeral.
However, your situation OP is different, it seems you are not quite at the stage of having severed contact indefinitely? In your case, I would discuss with your DH how he wants to proceed. If he wants to attend his grandmothers funeral and how he feels about this situation. I do not recommend allowing video contact with your dc, as that will allow your mil the opportunity to manipulate and distress your dc. You need to decide between you, whether this current six-week break in communication should become permanent. I would imagine they have been a lot less stressful for you all!
If your DH decides that he wants to attend the funeral just be very prepared for the flying monkeys. It will surprise you the lengths and depths that a narcissist parent is prepared to lie about you, in order to gather sympathy from extended relatives. Be prepared to be painted the villain!
Have you read either of the books, toxic parents or toxic in-laws by Susan Forward? If not I thoroughly recommend that you do. If your MIL is a toxic narcissist then keeping your children away from her negative influence is crucial.