Are grenades still an option? If not what is necessary to create grenades?
What's necessary is cast iron, or ceramica but we need enough things already let's not add this, if you want actually efficient grenades. In Europe, before the XVIII, they weren't that useful.
A really early alternative would be the "pot de fer"
Basically a big caldron where you put powder and virtually anything you could get your hand on : arrows, bolts, very small rocks...
Bombards as well can be done with basic metallurgical features (still appearing in Middle-East Europe around the XIII/XIV when it was far more common in China) and were more or less similar to first Chinese cannons of the XI century.
In order to have that, you need enough metallurgical knowledge being associated with chemical one. And experience.
Seeing how Europe owes its metallurgical advances to Arabo-Muslim advances you'll need a PoD to make them even more advanced and quicker than OTL (It's going to be hard) if you want to catch a bit the enormous lateness that Europe and western World had compared to China on this regard.
How could that occur? Would you need more theoretical aspects introduced and more chemistry elements added in?
Not really. Algebra itself wasn't really seen as an academic field science, as it was more a pragmatical knowledge, associated to geometry or economy.
Alchemist really tried to make their art acknowledged as scientific.
Admittedly, for Barbara Obrist, they were close to reach it in the beginning of the XIII, as it was associated with medicine that was an academic field.
But the cookeries on alchemy quite ruined it and the previous caution about its occult origin didn't helped.
You will need Univeristy to acknowledge more pragmatical features : it would be hard, as going against the conception of scientific arts as made in the beggining of Middle Ages. Having more favored urban elites and having them having a more important political and cultural role sooner may allow the teachings that were made marginally to University being more accepted socially.
What if instead of Iconoclasm, there is a return to Alchemy?
There was a Byzantine Alchemy, quite dynamic (and influential if we take the word of western late medieval alchemists). The issue here, is its recognition at least socially, better if formally.
I don't know about Byzantine scientific teaching and situation to say how to do so, tough.