It's a well known misappropriation of an American Indigenous parable like that saying about blood being thicker than water.

It was appropriated by some preacher man who couldn't come up with his own sermon material. From the beginning there was backlash. That's ehen the "Cherokee grandfather" entered the tale. You can tell because Indigenous people's didn't have concepts of good and evil like that until they were forced to convert.

The original versions say you have to feed both wolves what they each need or they will devour you from inside and that the blood of a covenant is thicker than the water of the womb.

I think the preacher heard the story from a Kiowa, definitely not a Cherokee, but it's unknown for sure where the story originated, but probably Inuit. Of course there was an advanced trade network between many tribes across the Americas.

A Medium writer, Linda Carroll did a deep dive on this parable some time back. Probably still in her catalog but I can't remember the title of her piece of the top of my head. You'll have to skim through to find it.