To allow anyone to abuse ones children, whoever they are, would seem to be complicit in child abuse.
We know there are the ten commandments which include, ‘honor your father and your mother’, but Jesus summed up the commandments with an over-all emphasis on loving God above all and loving others as yourself. You aren’t responsible for your parents’ formation, you can only pray for them, but you are responsible for your children’s spiritual, mental, emotional, and physical formation.
Your mother possibly wont let you withdraw quietly and you may find she gets worse in her desperation, so I hope you can calmly find the solution to that. Your mother acts in a childish kind of way it would seem.
Please don’t let her draw you into emotional responses at her level.
God grant you the strength to be a firm yet charitable adult in how you handle protecting your children.
It may be extreme to withdraw completely. Do you see as possible an attempt to negotiate with your parents for respect for your wishes and your children’s well-being. And to wisely regulate any visits, explaining carefully why and leaving some degree of responsibility with your parents to behave respectfully with your children and you?
I would imagine that she never resolved childhood issues of her own and never perhaps found the way to really mature as an adult, and as her husband felt unable to challenge her, she has been confirmed in the behaviour.
God bless you and your family.