Monster in law

So.. my mother in law is awful. When i first met her the first thing she told my husband was that she feels like he is settling and she said it right on front of me! And that she didnt like that i am not very family oriented (something she decided because my closest family lives three hours away). When she found out i was pregnant she was obviously disappointed. Continuously had to talk about how amazing his ex is. Told his other two children that this baby is not really their sister. She completely ruined the baby shower by telling everyone that i called his other two kids little f***ers. So everyone there thought i was a horrible person over something that never happened and then for the people that couldn't make it to the baby shower she posted this insane story of hers on Facebook. There were a lot of ppl who couldn't make it to the shower because we had to reschedule it since baby girl came two months early. As if i hadn't had enough to deal with my baby was in the NICU and his mother was pulling this. This is only a small bit of what she has done.. i cut her out of my life and my baby's life. While she is still invited to family functions she makes no move to speak to me or do anything with my baby. Is my decision acceptable? Who else has crazy in laws?