You can't fix this , nor can your husband , She sounds like a nitemare MIL. You do not HAVE to be around her. My first husbands mother was just a lousy mean person , I cut all ties to her, Didn't see her face for over 5 years. I did see her once after we divorced and I just looked her up and down , sighed and kept walking in the store.

Make sure you and your hubby are on the same page as in she CAN NOT talk shyt to your kid and your hubby will stop it no matter what or the MIL will lose the right to see her grandchild.

You and your Husband need to set firm boundaries and not bend at all when it comes to her.

Im sorry you have to deal with such ignorance and ugliness