Is it rude to directly contradict someone using their own words in a debate referring to actual facts?

You were rude because her Grandson's sexuality had nothing to do with being a real Man and the conversation. You insulted him and her(in her eyes) I know of the type of personality who tries to incite strong emotions in other people(perhaps your girlfriends Grandma?), and so its best to try to avoid conversations ,at any length with such people, on any heavy subject. Learn to be vague with such type of people. Get a book on the subject. And always keep the conversations light. About the beauty of her,the park down the street,etc. I think you should apologise and bring her flowers. Keep the peace.