Your associate was oversimplifying his story. Nobody can get a Dutch passport "simply because their grandparents were born and raised in the Netherlands." However, if a person's grandparents were Dutch citizens, there's a chance that that person is also a Dutch citizen, in which case she would be able to get a Dutch passport.
The key thing is to establish that the person who wants a Dutch passport is a Dutch citizen. If Dutch grandparents are involved, you will need to show that the person's parent was also a Dutch citizen. (This does not depend on whether the parent ever acquired a Dutch passport or other evidence of Dutch nationality.) Essentially, you have to show that each generation held Dutch citizenship when the subsequent generation was born, and that the conditions existed for the child to acquire Dutch citizenship by birth. This means that each parent must not have lost Dutch nationality before the birth of the child.
In general if the grandparents were naturalized elsewhere, that is, if they voluntarily acquired another nationality, they will have lost their Dutch nationality. Since your parents are still landed immigrants, they are still Dutch citizens, and were at the time of your birth.
When you were born in 1969, therefore, you were also a Dutch citizen. You probably lost that citizenship when you turned 28 (10 years after becoming 18). That happened in 1997. There are several things that would have prevented you from losing your Dutch nationality for 10 years, such as living in the Netherlands or the EU for at least one year, or getting a Dutch passport or certificate of citizenship. You never did either of these things, it seems, but if you had, you would have triggered a new 10-year period at the end of which you would have lost your Dutch nationality.
The rules around the 10-year period and loss of nationality changed a couple of times in the last few decades, but I don't think the details will help you. The only thing I can think that might help you is that the current rules include an exception for people married to someone serving in an international organization (such as the UN) of which the Netherlands is a member. So if your spouse works for an organization like that, you might be in luck.
Assuming you lost your Dutch nationality at age 28, your daughters, who were born after that, are not Dutch citizens, and therefore aren't eligible for Dutch passports.
If you want a more thorough analysis with regard to the specific nationality law that was in effect when you were born, at each point when you might have lost your Dutch nationality, and when your daughters were born, you can apply at the Dutch consulate. They will tell you what evidence they need to determine whether you are a Dutch national and when, if ever, you lost Dutch nationality. If you lost it after your daughters' birth, then they are Dutch citizens and can get Dutch passports.
