MIL Drama

So I have been with my man for well over 2 years now. He has a 5 year old daughter & her bio mother isn't in the picture. I moved 2 hours away, quit my job & everything to come live with them. I love them both dearly. However, in the 2 years I have been here I have dealt with thee most absurd monster in law ever. My boyfriend got full custody of his daughter when she was a year old. He has even told me his mother promised to be there and when he needed her most, she refused to help leaving him almost without a job. Fast forward to me getting here and it has been nothing but a literal shit show. She hates me and has hated me from the beginning. She told me that I took her son and granddaughter away from her, she told me that my stepdaughter is HERS and that I've only been here for a year, she has been here for all 5. She has told me I'm only in this relationship for control, she has told my boyfriend right in front of me that he needs to be with someone who isnt detrimental to his daughter. I'm not here to point fingers, nor am I here to toot my own horn. But I will say she lives off the system and sits home and smokes weed all day every single day. Just recently she told my stepdaughter that because her daddy and I aren't married yet, I'm not even her step mom. Mind you I have been her primary caregiver for over 2 years. We are also pregnant. We had 2 previous miscarriages but i am now over 15 weeks pregnant. She was at our home when I miscarried the first time and I had to go to the hospital. Instead of offering to take her granddaughter to help us out for an hour, she up and left. When she asks to see her, she DEMANDS. I have put my foot down and said I do not want her in this babys life. There is a whole other list of nasty things this woman has said and done but it's too much to even type out. I don't want to be controlling and vindictive with our newest addition, but I was raised in an environment where you cut toxic people off no matter who they are. This woman has zero respect for me as a person & she oversteps every single boundary imaginable. So basically I'm asking for any other monster in law experiences. Did any of you ladies feel terrible for cutting all contact off and refusing to allow someone like this into your babys life? I guess I'm not sure how many times she is allowed to use me as a human doormat before I am allowed to step up and say listen, screw you. I'll also add that my boyfriend has had many talks with her. And every single time she twists stories around and will tell him she has never said those nasty things. She has said them directly in front of him and in text messages. So I have all the proof. She is just extremely manipulative. I guess I also need strong women backing me so I dont end up backing down to this person. This is my first baby. I want to look back and know she was surrounded by love. Not people that are manipulating, toxic & possessive. Children are not pawns & she uses my step daughter as one. No I didn't give birth to her, but I have done everything for her every single day for over 2 years and I will continue to do so. All I want is respect.