So you don't like your DIL and think she is domineering to the point your son, your own child, is afraid of her and has no voice in his relationship. And your issue is the name they've chosen for their child?
Didn't occur to you to have a talk with your son before they got married/had a baby asking if he was ok, if he was happy in the relationship, if she wasn't a bit controlling, stood up to her a bit when she was domineering towards him in front of you? No, you and your husband just sat back through all that, let him enter an apparently abusive relationship and have children in it without so much as an "is this a good idea?", and now he's well and truly stuck with her on that island your stupid husband is looking to burn the bridge because of a name?
If you think he's so afraid and controlled in his relationship, you could be his (and eventually your grandchild's) only support and escape route. Abusers go out of their way to cut off and isolate their victims from their support and family networks. So why not tell your tittering husband that, and say that by failing to control himself, he is putting your child who you presumably love at risk by giving his partner a golden excuse to sever ties or at least severely reduce contact. See if he's still laughing then.
I'd also be interested how many jobs your DH has lost by being "unable to hide his feelings". I daresay like most of us he's had the odd boss who is a twat, but somehow he's managed not to say "you're a twat boss" just because it's how he's feeling. Tell him to use whatever methods he's employed for that purpose with his grandchild's name and get over what is obviously an ego thing for him. That good relationships are as important, and as reliant on him being basically socially aware, as his professional relationships.
Tbh though I don't believe she's a controlling monster or that your poor son is helpless in her clutches; I think she probably challenges your family dynamic, which you've all fallen into a deep groove of over the years, and you don't like it, so are both looking for any reason you can to dislike and disparage her. But that's largely because I don't believe ANYONE reasonable would choose this hill to die on.