I think it is up to him really since the act was towards him rather than you. I wouldn't want to step in the middle of a father - daughter relationship, here. I guess I'd just be as supportive towards him as you can be, and support whatever he decides. Their relationship is... Between them, really.

With respect to reporting her... That will most likely be seen as malevolent / malicious from her end. I hear that you are worried about her kid - but I also hear that you are particularly worried about her kid after her most recent act towards your husband. I wouldn't want to do anything to escalate the situation and reporting her would most certainly do that...