Why Jews are the chosen people? Are the Jewish people the chosen and if so why?...My uneducated Grandmother always said the the Jewish people were the chosen because they were the only people who kept God's laws at that time..such as, feast of the tabernacle, fest of unlevened bread..etc..I am confused. If not born Jewish, are the rest Gentiles? And if the Jewish are the chosen people why are they blinded to the first coming of Christ?
You really have to define "chosen" here. The Jewish people were "chosen" by God to reveal His Law to, an to have the Tanakh-primised Christ come out of. But as of the time Christ came, the "chosen" are those who have believed that Jesus is the promised Messiah and who have kept His commandments (it's a different topic as to what these are and what defines the keeping): 


  "Yet to all who did receive him, to those who believed in his name, he
  gave the right to become children of God" (John 1:12), "'Abraham is
  our father,' they answered. 'If you were Abraham's children,' said
  Jesus, 'then you would do what Abraham did" (John 8:39).


Jesus Christ said that those who keep the Law, besides His commandments, and teaches others so (at least the parts of the Law that were not directly abolished by the New Testament like having to sacrifice animals for atonement from sins - Christ became the ultimate sacrifice once and for all time, see Hebrews 10:12), would be called the greatest in heaven, while those who don't and teach others so, would be called the least in Heaven:


  "For truly I tell you, until heaven and earth disappear, not the
  smallest letter, not the least stroke of a pen, will by any means
  disappear from the Law until everything is accomplished. 19 Therefore
  anyone who sets aside one of the least of these commands and teaches
  others accordingly will be called least in the kingdom of heaven, but
  whoever practices and teaches these commands will be called great in
  the kingdom of heaven" (Matthew 5:18-19).


The reason many Jewish people are blinded as to the coming of Christ is because it is written in the prophets that it would eventually be so, see Isaiah 53:3: 


  "He was despised and rejected by mankind, a man of suffering, and
  familiar with pain. Like one from whom people hide their faces he was
  despised, and we held him in low esteem".