It's not quite as bad as that. Space is big and hitting stuff is really hard. Your hand grenade scenario has effectively been done a few times and it (obviously) didn't make LEO unusable. For example: https://en.wikipedia.org/wiki/2009_satellite_collision
There are thousands of pieces of debris in LEO large enough to be tracked, and a lot more that's too small to track but big enough to do serious damage. This isn't good but it's not wiping everything out. Adding a few thousand more pieces of debris would not be even remotely as bad as using a tactical nuclear weapon in war would be.
There are thousands of pieces of debris in LEO large enough to be tracked, and a lot more that's too small to track but big enough to do serious damage. This isn't good but it's not wiping everything out. Adding a few thousand more pieces of debris would not be even remotely as bad as using a tactical nuclear weapon in war would be.