Hi Peter,
Welcome to the forum!
In addition to the number "1146" which is on the side of the receiver (pictured) the serial number should appear on the front of the frame above the trigger guard. Below the numeric digits there may be a cursive letter. That letter is part of the serial number. Is it there? If so, what is it? From reference material it ought to be a cursive "x".
The Stick Eagle over 655 "SE/655" marks on the right side of your frame are military acceptance proofs. The SE/N on the left side of your frame is a commercial Nitro Proof mark from final testing of your pistol. This indicates that it was diverted from military production to police usage.
On the bottom of the barrel, you should find the barrel gauge stamping and serial number again. Please post a photo of that as well if possible.
Do the magazines match? Could we see the bottom of the magazine(s) and sides, including the acceptance stamps?
Finish condition and the matching mags impact value a great deal. Would you estimate 90% original finish?
You have a very nice Luger! If all is right, it is rather rare. According to Joop and Hallock in "The Mauser Parabellum" it could be part of a range of 860 similarly marked pistols, of which 39 (now possibly 40) are known, with only 4 (now 5) of those Police pistols.
Since this is from your Grandfather, it's likely he brought this back from WW-II in Europe. If so, the gun may have been authorized for return by the Army through a set of "Bring Back Papers" signed by his officer. The originals of those papers add to the value, provenance and history of your firearm. Do your best to locate them if they exist...
Marc
__________________
 Igitur si vis pacem, para bellum -
- Therefore if you want peace, prepare for war.
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