Your Grandpa was a funny guy, and he's right - stabbing is much more likely to kill than cutting. Good thing you were able to disarm that drunk. I've been carrying a knife much longer than a gun. I consider my knife a deadly weapon, and would never draw it on another person unless justified and prepared to use deadly force. In 20 years, that has only happened twice. Luckily for everyone, the attackers in those incidents broke off and escaped once they caught a clue that I was ready to kill them.
Check out these facts on knife killings in China:
School attacks in China (2010
Probably one of the few countries where it is close to impossible for a civilian to obtain a firearm. Still, 21 dead in these attacks, most of them small children, and 90 injured.
In your own country 2007 and 2008, school shootings in Jokela and Kauhajoki left 19 dead and many others injured. Both committed by psychos using only .22 cal pistols!
With the psychos who set out to do this kind of thing, I think the weapon is always secondary to their intent to kill. They will find a way, and will always do the most damage that they can.