In the traditional Little Red Riding Hood versions, grandma is an old woman living at the outskirts of the forest. She is helpless and needs the assistance of Little Red who embarks on a journey through the forest to assist grandma. While a lot of contemporary renditions focus on revising the character of Little Red, Lee focuses on grandma, Anna the Matriarch, and invests her with significant power. Describe the facets of Anna's power. What is the value in this revision of the grandmother's character?

In Tanith Lee’s short story Wolfland, Anna the Matriarch’s character is revealed layer by layer. She has power, and there is suggestion in the early parts of the story that she might be abusing it. She has economic power—giving her control over Lisel’s education and her life. She has supernatural power, first shown in the note given to Lisel at the edge of her grandmother’s land, and then when her true nature is revealed to be that of a werewolf.
As a young child, Lisel is aware of her grandmother’s power: over Lisel’s education, over her social movements, and over her father. Lee uses a rather striking term to describe a portrait, hanging in Lisel’s childhood home, of Anna as a young person: “wicked-looking, bone-pale.” This sets the scene and seems to direct Lisel’s expectations of her. When Lisel grows up a little more, she is summoned to her grandmother’s mansion, and she knows she will not refuse.
Elderly women are often disempowered in stories, depicted as sweet and helpless, as in some of the traditional Red Riding Hood stories mentioned in your question, or they are depicted as one-dimensionally evil, as in wicked old witches and so forth. They are seldom allowed to be complex characters. Anna the Matriarch is an intimidating character who is presented at first as maintaining an almost tyrannical rule over her family, but as the story progresses it becomes clear that there is more to her than that. She possesses the protective instincts of a wolf. Through her grandmother, Lisel is able to realize her own power.
Whereas traditional renderings of Little Red Riding Hood emphasize male dominance, Lee’s retelling presents the female characters as the subjects rather than the objects; they are the driving force in the story.