Pointing to a lady, Diwakar said, "Her mother's only grandson is my son." How is that lady related to Diwakar?

Introduction / Context:
In this blood relation puzzle, Diwakar talks about a lady and a particular grandson of the lady's mother. The key phrase is her mother's only grandson is my son. You must determine which of the lady's children could be this only grandson and how Diwakar must be related for his son to fit that role. From there, you can deduce how the lady is related to Diwakar himself.

Given Data / Assumptions:
- Speaker: Diwakar. - Reference lady: call her L. - L's mother has exactly one grandson. - That only grandson is Diwakar's son. - We assume a straightforward family structure: no stepchildren, and grandson means a son of any daughter or son of L's mother.

Concept / Approach:
If L's mother has exactly one grandson, he must be the son of exactly one of her children. Diwakar's son is that grandson. For Diwakar's son to be L's mother's grandson, Diwakar's son's mother or father must be L's mother's child. The most economical and standard assumption in such questions is that the lady L herself is that child. That makes Diwakar's son the son of L, and Diwakar the husband of L. Under this interpretation, L is Diwakar's wife.

Step-by-Step Solution:
Step 1: Her mother's only grandson is my son means Diwakar's son is the only grandson of L's mother. Step 2: A grandson of L's mother must be a son of one of L's mother's children (for example, L or her siblings). Step 3: If we assume the simplest structure that suits exam style, L is the child whose son is that only grandson. Therefore, Diwakar's son is L's son as well. Step 4: If a boy is both L's son and Diwakar's son, Diwakar and L are the boy's parents and form a married couple. Step 5: Hence, L is the wife of Diwakar.

Verification / Alternative check:
Picture L's mother at the top. Below her, imagine one daughter L and no other children who have sons. L marries Diwakar. Their only son is then the sole grandson of L's mother. In this scenario, Diwakar's statement is exactly true, and the relationship between L and Diwakar is that of wife and husband. If L's mother had another child who also had a son, there would be more than one grandson, contradicting the phrase only grandson. Thus the described arrangement is consistent and minimal.

Why Other Options Are Wrong:
- Aunt: L would be an aunt to Diwakar's son only if she were a sister of one of his parents; here she is depicted as a parent herself. - Sister: A sister of Diwakar would not normally produce a grandson of L's mother that is also Diwakar's son. - Mother: For L to be Diwakar's mother, Diwakar's son would be her great-grandson, not her mother's only grandson. - Sister-in-law: A sister-in-law relation would not naturally make Diwakar's son the unique grandson of L's mother without adding extra assumptions.

Common Pitfalls:
Students sometimes try to place Diwakar as a brother or brother-in-law of L and then force the grandson relation through multiple siblings. This quickly leads to contradictions or extra grandsons. The phrase only grandson strongly suggests a single child of L's mother having a male child. Recognising that Diwakar's son is that child's son points directly to L being his wife.

Final Answer:
The lady pointed to by Diwakar is his wife.