I've thought some more and I've finally crystallised why I don't like what they're doing, beyond recognising the general fact they're taking advantage of you.
So here's a hypothetical situation, using figures I've plucked from the air at random. That doesn't matter, whatever the true figures are, my point still stands. Here goes:
You look around at properties, you decide you need 10 acres. You find one for £800k. You get a 100% mortgage. So you've paid £800k for a property that's exactly what you need, 10 acres.
Then SIL puts a horse and caravan on 3 acres. So now the situation is you've paid £800k and you've only got use of 7 acres, not the 10 you decided you needed at the start.
So,
if you'd known from the start that SIL wanted housing by you,
and there'd been a property for £700k with 7 acres,
would you have bought that instead?
And then also taken out an extra £100k on the mortgage, using it to buy a flat in the nearest town for SIL to live in? An option that would have been better for you than a caravan on your land, because it wouldn't involve feeling like SIL is in your personal space so much.
It would have left you in a similar situation, £800k mortgage, you with 7 acres and SIL housed. Just in a different format.
Because if you wouldn't have done that, then why are you letting her have some of your land to use for horse plus caravan living, indefinitely?
Whether she pays anything for rent and livery fee is irrelevant to this point I'm making here. Either way, you've bought a proportion of property you can't use because you're letting her use it.
If she was a much loved sister, perhaps with problems not of her own making, like your DDs situation, then I could understand the sacrifice. But for someone who's disinterested in you and taking the piss? That, I don't understand.