Hello.
You have quite a specimen there!
Dividing your plant may actually be best for it. You need to remove all of the old medium. It will thrive and you'll be able to divide this memory of your grandad among other family members.
I couldn't find a video on dividing cattleyas to help you, but I did find one on dividing cymbidiums. Even though they are not the same, the dividing process is. So here is the link.
Here is also some instructions I found:
Orchids - Repotting a Cattleya
You'll need a good bark mix which you can buy at quarteracreorchids.com (they're great).
Make sure you soak the plant really well before attempting this. It may also help to break the pot rather than try to remove it.
And to answer your question. Yes each growth only blooms once, ever. The newer growths are plumper, have newer roots growing from them, and are the growths that flowered last. The older ones are more shrivelled.
Good luck, and please keep us posted.
The idea of putting it in a basket is not a bad one.