It was a very difficult situation you found yourself in. On the one hand your SIL sounds quite domineering, which isn't easy to live with and almost certainly contributed, if not caused your daughter to be susceptible to someone else who wasn't. On the other hand SIL obviously doesn't see it that way! Really the only way to handle this dilemma is to sit on the fence from day 1, as so often things are resolved between the protagonists, leaving you, having come down on one side (rather naturally your daughters!) as the MIL from hell!! I do feel for you, but I think all you can do is discuss it with your daughter and treat your SIL as you did before this happened and just hope that with time things right themselves between you. Good luck!