I really enjoyed reading "Pet Milk." I googled it, and on the can it's really PET Milk. I am not sure why Dybek made the choice to change the capitalization of the word, but think perhaps it has the effect of sweetening the image a bit. Pet milk makes me think of pet name, something sweet, and he uses the Pet Milk to evoke sweet memories from his past.
I sort of feel like Dybek shouldn't have included the memory of his grandmother in this story, the meat of it all lies with his memory of Kate, and as a whole I don't feel that the two memories converge that well.
One thing I cant stop wondering about, and maybe I'm just a sicko, is... is Pet Milk (the thick, off-white liquid) supposed to be present in the last scene of the story, on the train? I'm probably reading too much into the significance of the Pet Milk, though.