Whatever you do OP do not give the SIL a rental agreement, only a lodger agreement. With a tenancy, the only way you can get her out is to go to court to evict her with bailiffs. It takes months.
During which time, she maybe won't pay, will trash the place etc and you'll be responsible for the welfare of her horses because they'll be on your land, but you won't be able to PTS for financial reasons or sell them on, because they don't belong to you. You won't even be able to say anything about anything, because she'll have a right to quiet enjoyment of her home that she's renting and you'll be at risk of being sued for harassment and breach of contract if you do. This still applies even if her rent is not being paid and she's the tenant from hell.
Lodgers have no rights really, except for the notice period. After that you can change the locks. Although how the heck you "change the locks" on a sprawling property including fields and barns...
Just don't let her come. She's not going to help your DD.
Your DH is the purse, having inadvertently bought SIL every horsey person's dream, a house with land. I have zero doubts this is how the family view it, they've never viewed him as an autonomous person, he's never existed other than as his role within the family. It's why he's got no boundaries, he wouldn't have been allowed any growing up, or to properly forge his own identity separate from them and his role within the family. He won't necessarily have any awareness of this. To him it'll all feel normal. He may have some misgivings about being railroaded into this, but he's doubting himself instead of kicking off yelling a big far No! to them all.
SIL will take over completely, she'll be lady of the manor, you'll be housekeeper/skivvy and your DD will be equestrian staff/skivvy.
DD will grow up without proper boundaries herself, thinking all this is normal and when you die, DDs inheritance, this house and land, will effectively belong to SIL. With her age and soon to be eligible bachelor (or whatever you call the female equivalent) status, she'll quickly be married and sprogged up with the next generation of golden child, by some man who fancies himself as lord of the manor.
Your DS won't get a look in, unless he's happy with the role of purse, like DH. Maybe he'll attempt to save himself and move out as soon as he hits adulthood...
And so it continues, endlessly, down the generations. Unless somebody breaks the pattern.