Zinedine was born Jewish but converted to Islam and moved to Gaza.
Haniyeh posed for photos with her and her children, who are - according to Jewish law - full-fledged Jews.
In a 2003 interview, Zinedine said that her original name was Esther Mordechai Machima, that she was born in Morocco in 1953 and move to Israel in 1955. She was working at a factory in Ashdod when she fell in love with an Arab truck driver, so she married him. In that same interview she said that she felt that suicide bombing was a natural reaction to Israeli crimes. She had five full-grown children at that time - three sons and two daughters - so the children here must be her grandchildren.
Haniyeh seems to be getting a little grabby with her granddaughter. Then again, she might be old enough to marry him.
(Yeah, I know, it's a cheap shot.)
UPDATE: Lots of comment about my cheap jab. I was honestly bothered by how Haniyeh was holding the girl who is not his relative. I shouldn't have mentioned the kiddie marriage part - that generally happens in Gulf countries but not by Palestinian Arabs - but still, yecch.