Oh the emotional baggage that come with Christmas. Almost any other day of the year we could accept it, but it really hurts when it is Christmas.
If she is not going to change, and it sounds very much as if the longer it goes on the more stubborn she will be, you may be able to get your DS to negotiate a compromise -the weekend immediately before Christmas perhaps, or Christmas Eve (and if DIL is too busy to come, too bad) You invite the family over, exchange presents and try very very hard to get Christmas out of your system that way. I know it is easier said than done but this will not go away and why should her stubbornness and insensitivity be allowed to ruin your Christmas.
I actually cried when DD3 told us that they were going away to DD1's holiday house with them one Easter as I had (wrongly) assumed they would all come to us. DH was not well enough to go away although we were subsequently invited to join them. I recognised my own irrationality as in this case no deliberate hurt was intended but this is much more hurtful for you.
Dare I suggest (without knowing her) that your DIL is being selfish and immature? If she is using this as a DIL/MIL power struggle, you can show her by example. If she won't give way, the only change can be in how you view if, if you can see your DGS before Christmas then put it behind you and plan something non-Christmassy for DH and yourself on the day,( maybe with friends?) so that you are not dwelling on what you are missing .
Good luck, I do feel for you 