I gave her mum the words that I would not punish the dog again. Then I told my wife I will not be doing that and will carry out more positive reinforcements.
What you did is fine, that's how dogs learn. Why would you let her mom scold about a dog that your WW dumped on you? I'd tell your MIL to stay in her lane, and if she got mouthy more I'd be more frank about what her daughter is doing and ask if she plans on intervening there as well.
I agree with LH in that you need to stop with the R talks, quit talking about her.
This is very common today where we can't hurt a dog's feelings. I just heard a report where you should never "yell" at your dog. LOL People view animals and pets above humans these days. So none of this surprises me. I am sure in some jurisdiction in the western world swatting your dog on the butt would get you jailed for animal cruelty. Crazy mixed up world today.
However, I agree with TS's capitulating on this. Best to defuse the situation than to aggravate it. It is a small point of concession. Is the plan for her to take the dog after the D?
M(53), W(54),D(19) M-23, T-25 Bomb Drop - Dec.23, 2017 Ring and Piecing since March 2018