After I had my third child, daycare just became way to expensive. I had one child in school and was paying for before and after care and I had two children in daycare. I choose a daycare that was one of the top ranked ones because I was afraid due to the horror stories I sometimes heard on the news. The daycare center was really nice, but pricey. I wish that I could have afforded a nanny, but our home just was not set up for a live-in nanny.
A friend of mine has her parents which her baby and they love doing it. The problem arises when the parents have to take time off for vacation, doctors appointments, etc. Unless you have a flexible job, this becomes quite the burden.
I am glad that I choose to stay home at this time. I work from home so I get a little mental stimulation and I also get to be involved in my kids school activities. I think I have the best of both worlds!