My children are grown, and not once did they ever try to harm me in any manner. There's no way in Hell that I would have let her get away with that.
He think it's funny now. But when she's older and starts throwing things out of frustration, cursing, and calling him out of his name; he's going to wish that he was a better parent, and not one of his children's playthings/playmates.
It's Ok to play around with your children. But there should be a boundary that they aren't allowed to cross. I say it time and time again, "We're losing that Old School wisdom from our Grandparents."