What a beautiful quilt and, yes, the light grey really does look good!

Part of the decision has to do with the scraps you are using. If there are lots of strong colors you might consider navy blue. If the overall feel is more moderate, I would think gray would be great. Since you are undecided I would think that finishing the blocks and laying them on a color you might choose for the sashing would give you the best ideas.

A friend of mine uses mostly burgundy, navy, and "Harry Potter" green for her scrappy quilts - they all look great.

Choose a color that makes the blocks pop or stand out. You'll know what to use when you have them finished. After living in Seattle for 18.5 years 9but who counted?) I do not use gray. In anything. IF this is a child's quilt, they are more drawn to brights. IMHO

I always have a laugh with my students when I tell them 'your quilt will tell you what it wants'. I don't want to make that sound all Zen-like, but it is true. When you have finished your blocks, lay out a few colors and sit the blocks on them (what we call auditioning). Leave the room and each time you walk in,look at your samples and think about what grabs your attention and why. Is it conflicting with the blocks? does it fade away? or does it really frame the blocks and make them shine? Sometimes it is the color you would never expect that brings out the best. Also, if 2 colors are really striking you as great, consider using ones as sashing and the other as cornerstones.

Black always looks good with scrappy.

As you can see, we all think that different colors would work. I do what others do and that is to wait until the blocks are sewn together and see what color catches my eye first and go with that color.

When I first started quilting umpteen years ago, someone once told me that red, dark blue or black solid colors goes with just about any color. Since I tend to use a lot of reds or blues in my quilts, that advice has always worked for me. Black works with just about any color and tends to really make block colors stand out.

Another thing that I would consider is that since this quilt is for Project Linus, I would think that the darker colors would keep the quilt looking cleaner for a longer period of time.

I will agree that children are drawn to bright happy colors and not to colors such as gray and black....but a brighter navy would be o.k. I've made several quilts for Project Linus and all are out of the colors in a primary coloring box. But in the end I will say that color choices are up to the maker.

This is good advice. Sometimes after blocks are completed a color stands out that you had completely overlooked as a sashing color before. I don't think the sashing should distract from the blocks but rather complement them.
Have fun. Glad you are giving to the Linus project.