I sympathise that you struggle to manage family dynamics due to your background but for your daughters sake you need to address this issue.
What's the reasoning behind dd not seeing much of your OH parents? I know they're not her biological grandparents (some posters seem to have missed this fact) but it sounds like they'd like to get to know her and maybe love her? As you're nc with your family (and I'm guessing for damn good reason given you were in care) That could be really good for her.
I can totally get why you find this all difficult and foreign and that you quite possibly don't trust older adults but not everyone is like your family.
I really think you'd benefit from some therapy on your thoughts and feelings around family, maybe with a therapist with an interest in parenting? NOT because you're not a good parent YOU ARE but so you feel more confident as a parent, which would make it easier to shrug such comments off.
I've been looking after other people's kids since I was 13, I'm the eldest of 3 kids and a stupid amount of cousins, I was a nanny before I became a mum and a childminder after and I STILL have moments where I think I'm getting it so very wrong and take others comments to heart.
However, I also have the benefit of the confidence that comes from so much experience, I think perhaps you weren't completely sure which is why you took OH mothers comment so much to heart.
I like others think perhaps she picked up on your nerves and just wanted to reassure you that she was well aware of what boisterous 5 year olds can be like on Christmas Day (your oh was one one year!) and didn't want you to worry that you are both welcome in her home. And worded it in a poorly thought out way.
My now ex mil and my mum have crazy amounts of ornaments and nik naks at toddler level, they have 10 and 6 grandchildren respectively, they move fragile ornaments out the way for the kids but only so the kids don't get hurt, any more robust items are left and if they get broken they genuinely couldn't care less as long as no child hurt, they have no problem with the kids jumping on sofas etc there's often memes on FB etc which are very accurate - basically grandkids get away with a hell of a lot more than the kids did!! But that's at least partly because they're not dealing with the behaviour all the time AND they're not the ones that get criticised if a child behaves poorly.
Enjoy the rest of your Christmas and don't avoid people so much, I realise the temptation is to avoid the difficulties, the pain that can come with relationships but it's also very lonely.
Let your oh and his parents in if they really want to be and let them take some of the pressure off. I have a sneaking suspicion you're like me and think you have to manage it all yourself as otherwise what will people think?
You know where that approach got me? A nervous breakdown!
I didn't grow up in care but in an abusive household and I don't trust easily - I don't trust anyone easily. It makes sense to a degree...but it also makes things really hard!
My lovely ex in laws really struggled to understand at first why I was so protective of dd, then something happened (my parents cocked up again no harm to dd but freaked me out) and it all came out (then dh had known for years) then mil said straight away "well no wonder you won't let her out your sight!" And gave me a huge hug. They then made it clear they'd absolutely go at my pace and what I was comfortable with. Prior to this they'd been feeling confused and hurt why I wouldn't do certain things. Lovely ex fil even offered to back right away from babysitting etc if that made me more comfortable. It wasn't necessary I knew I could trust him and dd adored him (sadly due to her fathers inaction her relationship with those grandparents has dwindled to almost nothing).
Does your oh parents know your background? It might help them understand where you're coming from?
I hope you're feeling calmer now anyway.
"She’s broken 2 of my toes and her dad’s nose before yet has somehow managed 5 years unscathed." As a side note - this could have been my dd, since diagnosed with eds type 3 after many years of my despairing at her "clumsiness" which somehow even with some spectacular falls (and numerous bruises to me!) never resulted in any major injury to herself. Just something to consider. There may be a reason for her clumsiness, it may not be eds, it might be a sight or hearing issue or something like dyspraxia.
"She’s an ignorant livewire" when was her hearing last tested and if her hearings ok you might want to consider an auditory processing disorder?
"you can still go through counselling/medication and still not be totally OK." Absolutely - but that also doesn't mean it can't still be useful to revisit therapy, with a different therapist with a different approach and perhaps expertise too.
And finally I'm also a "strict" parent who was criticised for such by other mums etc - my dd is now almost 18, in a good full time job, kind, confident & responsible. Their kids? Running wild! It may just be sofa jumping at 5, at 15 (especially where I live) it's binge drinking, drugs, joyriding, pregnancy and sti's! Like hell was that happening to my dd!
And (fingers crossed) so far so good. She tells me everything (and sometimes I really don't want to know 😬), has a drink sometimes but knows her limits, has never even tried a cigarette (her bf smokes and she's CONSTANTLY nagging her to quit) let alone illegal drugs. She had her first serious boyfriend (and broken heart - god that's worse than going through it yourself!) last summer and was sensible enough to go on pill and use condoms.
Don't get me wrong she's no saint! She has a temper, holds people to crazy high standards sometimes, is absolutely NOT a morning person 😂 and is too sharp and quick with her tongue and biting humour sometimes (learning curve there tries to help cure this bad habit).
But overall I think I've done ok. Maybe dd disagrees I don't know.
This parenting lark is bloody hard and there are times we feel we've really fucked up and let the DC down. When dd got her Dx I felt sick at all the times I'd told her off for being "thoughtless" or "clumsy" or "not being careful" because it mostly wasn't her fault. That was a really tough day for both of us! (Dd also told she needed to give up hobbies she loved). But you know what? You dust yourself off and you start again the next day!
Op you're a good mum 