I can in fact buy one at a local brick-and-mortar store, but the price is triple/quadruple the amount I'd pay for a copy of my house key. Add in that the whole flow is something grandma is not going to be able to grok, and the whole idea is still-born.

If I were administrating that part of her life too, then maybe, but I'm not really happy with how Yubikey has solved for this problem either. If I could buy them for nearly throwaway amounts of money, and I could make backup copies without issue, then I might even jump on that particular train myself.