It's hard to tell sometimes what the right group is, though. My grandmother moved in with us. We all got on so well it seemed like the obvious thing to do. But she became depressed and just felt like she was living in someone else's house (which she was, really). Living together is a tricky thing and in my experience it's hard to know what will work. Worth a shot, though. They might love it.
I think separate living spaces is really critical (I can't imagine doing it in the same space). My mom usually comes over in the morning to help get the kids out the door for school, but other than that it's not uncommon for us to go at least a day or two without seeing them.
If you're going into it with a "give it a shot" attitude, be sure to do it early enough that changing plans is still an option.