Relationship with sil broke down over a year ago- me and dh had always had a close bond with her dd's. I won't go into the full backstory but the wider family have agreed that we weren't in the wrong and sil is becoming increasingly volatile and has fallen out with other relations since too.
we've now been told by other family members not to send her dd's Xmas presents - she won't be given them anything from us and won't be sending anything to our newborn.
I wasn't expecting anything for our child as sil doesn't know them, but we've quite close to her children and they are older (although not adults). I asked if anyone would pass on a gift but they don't want to get involved.
I don't want her children to think that we've forgotten about them this Xmas and equally sil has a way of twisting the truth so if we didn't get a gift to them it would enviable become 'they left my children out' etc.