sweltering The power is their ability for it to still hurt/for them to still hurt us with their negligence even decades afterwards - if we can get to a place of acceptance and zero expectation then we protect ourselves, we protect the children from that pain.
Children will always take their emotional lead from us, if we are upset they will think it is something to be upset about and feel sad too. If we deal with it in a breezy way, and put it down to bonkers Granny and she is what she is, they will adopt the same view (mostly whilst young, and as young adults they will come to their conclusion) We set the tone.
So if we want the rejection and pain to continue, we nurse the grudges and resentments, the flashes of pain will make us angry and fume that this not acceptable, how dare they let my kids down. I have been there. Believe me.
In a situation with my own family that involved a cancer prognosis (mine) and they still failed me. Perhaps it is only then that you know where you are truly at with some people.
Sometimes we have to simply accept that some people are utterly shit, and there is nothing you can do to change it. Move on to something more rewarding and life giving.
I am not makes excuses for them, I am simply saying that the only person that will suffer is op, unless she lets go of the happy families dream and just looks at them in the cold light of day. Whatever she sees there is the truth, rubbish as it is.
The christmas meet up is usually the last thing to go, and as you say it is liberating to actually not care particularly either way.
In some ways op you have been spared the pain of your own parents being like this, it is easy to cut out the in laws because you are not tethered to them biologically or by blood. Your dh probably grew up knowing just what they are like, and he is far from surprised it turned out this way, but it must hurt on some level. I would do all you can to protect him from their failings, look after your dc, give them the best childhood you can and let the rest take care of itself.