。
Grandma was sitting primly and neatly on the cushion.
Literal
Grandma [subj-が] floor-cushion [gen-の] top [to-に] neatly sitting [progressive-ていました].
ちんまりと is a mimetic adverb meaning 'neatly / primly / compactly' — evoking a small person sitting quietly and compactly. 座布団 'zabuton / floor cushion' is the quintessential Japanese sitting cushion. The ~ていました progressive-past gives a snapshot description of an ongoing scene.