Your granddaughter and your sister's granddaughter are second cousins.
Grandchild
Your sister's great grandson is your great great nephew. You are his great great uncle, or great great aunt.
your great grandchildren
Great aunt or great uncle depending on your gender.
Great niece or nephew.
Great grand niece
Your child and your nephew are first cousins, so your grandchild and your nephew are first cousins once removed.
The grandchild of your great aunt is your second cousin.
Your brother's grandchild is your great niece (girl) or great nephew (boy). You are their great aunt (if female) or great uncle (if male) Your brother's grandchild'd (great grandchild) is your great grandniece (girl) or great grandnephew (boy). You are their great-great aunt (if female) or great-great uncle (if male)Your grandchild is your brothers grandnephew.
You are great great aunt to your niece's grandchild. Your children and your niece's grandchild are first cousins, twice removed.
your great cousin twice removed.........i think
No, there is nothing wrong with it. People are not likely to be able to figure out that there is any relationship, and if the great great uncle is from the "other side" of your grandchild's family, he is not related to you at all.