Your MIL lives to stir up drama and suck everyone into it. I think you understood my recommendation and don't really need me to clarify it.
If your fiancee is being hit by his mum and you want to get involved to try and stop that, you can do whatever you think best. I've given you my suggestion, but you don't have to agree.
Unless your boyfriend is crippled, he is capable of stopping his mother from hitting him. Whether or not he is going to tolerate being hit is something for him to decide. Each person sets and defends his or her own boundaries. Your job is to set a boundary for you. I would recommend that you do not tolerate this woman putting her hands on you. If you figure out how to do that, you will be setting a good example that your boyfriend might learn from.
How she acts in her own house is pretty much up to her. When you are in someone else's house and they start behaving badly, the smart thing to do is to leave. If I were you, I wouldn't go putting my hand or even my fingertips on her. That just feeds into her plan to create craziness. That's letting her manipulate you.
You tell your boyfriend, "I think we need to leave." Then you walk out the door." Hopefully, he will follow you. You have to stick to your guns and refuse to be around this woman when she gets this far out of line. Be consistent, and eventually your boyfriend may get a clue that he doesn't have to just take abuse.
The problem is not that this woman hits people. The problem is that people tolerate being hit by her. That's their decision. It doesn't have to be yours.