Allen, from Banbridge, County Down in Northern Ireland was reportedly given a panic alarm to contact security services with if her granddaughter Samantha Lewthwaite made contact.
But the stress of the situation and her anxiety the over global media speculation about Samantha's involvement have reportedly taken their toll on the pensioner's health and mental well-being.
Joan Baird, an Ulster Unionist Councillor in Banbridge who knows the family, told the press: 'This is so distressing for everyone. Mrs Allen is 85 and she is in and out of hospital. It is just so distressing.
'Certainly, everybody in the town is shocked and distressed by the news.'
Lewthwaite, a 29-year-old mother of three, is the widow of London suicide bomber Germaine Lindsay and is reportedly suspected to have been the instigator of the weekend gun and bomb attack on Westgate Shopping Centre in Nairobi in which more than 60 people were killed.
Born to her English soldier father Andy Lewthwaite and his Irish Catholic wife Christine Allen whilst he served in Northern Ireland during the 1970s, Samantha had a happy and incident free childhood on Banbridge’s Whyte Acres estate.
According to the Daily Mail Lewthwaite was still at primary school when her family moved to Aylesbury in Buckinghamshire, but in 1995 her parents split up.
At the age of 17 Samantha converted to Islam and changed her name to Sherafiyah, marrying Lindsay, the man who detonated the bomb at King’s Cross Tube station, killing 26 people in July 2005. The pair had met on an Islamic chat-room.
At the time she told the press she was horrified by the massacre, but now authorities have started to doubt her claims.
Suspicion was raised in 2009 when Lewthwaite disappeared with her three children, only to reappear two years later having traveled to Kenya on a false passport.
This week Kenyan authorities issued a photograph of Lewthwaite, who they say they want for questioning about a bomb factory in the coastal resort of Mombassa.
Although her grandmother has allegedly been overcome by press interest in her granddaughter, it is understood Samantha has had little contact with relatives in Northern Ireland since her conversion to Islam.
Aylesbury Councillor Raj Khan, whose family knew Lewthwaite's family socially, told the Daily Mail he is surprised at press reports she could be involved in the attack in Kenya.
'She was not strong-headed. And that’s why I find it absolutely amazing that she is supposed to be the head of an international criminal terrorist organization.
'She was an average, British, young, ordinary girl. She had a very great personality. She didn’t have very good confidence,' he said.