As for ピーピー, it is an onomatopoeia of the cry of a baby bird. So がばいばあちゃん wanted to express her grandson to be unripe and noisy just like a baby bird.
As for で済んだ, yes, it is generally used in the positive sense of "get by without ~ing".
In this context, the state of the baby's ピーピー crying is expressed as a far better situation than that of something otherelse, so the cry was expressed in the positive sense like to get by without making a further more trouble or annoyance.