I haven't read all the posts, but wanted to respond.
I know you don't want him to have a title at all, but it doesn't sound like you're going to get away with that!
Next time he, or somebody else, refers to him as Pa I say quite clearly "We'll have to come up with a different name for you. Dad is "Pa", and always will be, and it will confuse the girls. How about......?"
It might cause some hassles, but not as many as refusing al together, and it's not good for you to have to listen to him being called something you don't want him to be. Putting it back on being confusing for the girls would take the pressure off you a little. My mum is Gran, and my dad, who died before my kids were born, is referred to as Grandpa, will the IL's are Grandma and Grandfa.
Goodluck, and if they don't respect your wishes, i'd limit contact - the kids are your main concern, not what others think or want!
Dette, DS 06.03, DS 10.04, DD 03.06 & Due Sept 07!