Dougster:
What you are experiencing is normal if the grapple does not work when both the following are true: 1. the last remote is held full open to direct fluid to the backhoe, and 2. the backhoe valves are all in neutral.
Here is why: the remotes are probably arranged in parallel. That means (since your tractor system is open center), when all remotes are in neutral the fluid from the pump flows through all the remotes in the common "open center" gallery in the remotes and then to the tank, three point, or whatever is down stream.
In a parallel system, when any remote valve is opened several things happen in the remotes as a group: 1. the open center gallery within the remotes is blocked off by the valve you opened, 2. the fluid that has now been blocked from passing through the remotes as a set gets out of the remote set through any individual remote valve that is open, 3. the movement of the backhoe remote spool that blocked the open center gallery and keeps fluid from flowing out of the remote set also opens the work ports on the backhoe remote, 4. the fluid now flows through the backhoe and back to tank, etc. 5. if you now open the upstream remote connected to the grapple, the grapple spool also blocks the open center gallery, but that changes nothing because the backhoe spool has already blocked that gallery, 6. the grapple work ports are also open to allow fluid to flow through them to operate the grapple, 7. that means fluid going into the remote valve set has two routes (a) the backhoe, and (b) the grapple, 8. since fluid flows where the resistance is less, it all flows through the backhoe since (as assumed at the start) none of the backhoe valves are operated and the fluid can pass freely through the backhoe valve set and back to tank, etc., 8. none flows to the grapple because, even though the grapple circuit is open and fluid from the pump is present at the grapple work ports, the movement of the grapple creates more resistance to the flow of fluid than does the free flow through the backhoe valve.
If I am correct, if you also operate one of the backhoe valves at the same time (say raise the boom), then resistance to the flow of fluid through the backhoe circuit will arise and this resistance will cause some fluid to flow into the grapple circuit where the resistance is now probably less.
This is one of the major disadvantages of the open center system: you have to block off the open center to get any work from the fluid. In the closed center system (variable displacement pump) no fluid flows until a valve is opened, and the pump decreases its output flow to virtually zero (actually, just enough to keep pressure (say 2500psi) in the system). When one valve opens and the pressure drops a bit, the pump increases its volume to build the pressure back to the original 2500 psi. If another valve is opened at the same time, the pump (assuming it is large enough) further increases its volume to keep 2500 psi at both valves. Therefore, both valves receive full flow. The rationing of fluid away from one valve to another one with less resistance only occurs in the closed center system when the pump is operating at capacity and can't increase its output to keep full pressure on all valves.
So as you suspected, the backhoe thumb will not operate unless either 1. the remote to the backhoe is in neutral or 2. you are engaging a backhoe function at the same time.
Can you insert a solenoid selector valve into the backhoe bucket circuit so that you can shift the bucket circuit between the bucket and the grapple, just like many readers do for their grapple with the FEL curl circuit?
And if not in series, how are they set-up to operate? 
