I can’t have one child doing stuff, meeting other kids as a result, being invited to things when the other child does just one afterschool club.
Your eldest is what, 10? Your youngest is 5. Your eldest isn't going to be invited to things with 5 year olds. There's an age gap as well as a privilege gap and you can't just force your eldest into your youngest's social life. She has to develop her peer group independently of her sister. You're thinking this is your youngest's job and it's just not.
My stepdaughter doesn’t live with us.
And when she's around, you expect your eldest to be there. Have you ever thought about giving SD and her little sister and your husband their own time? Or giving your MIL time with her youngest granddaughter without your eldest around? Again, your SD is 14 or 15 so another age gap and she's not there to spend time with your eldest. She's wanting to see her little sister without dad's wife and daughter there constantly.
My MiL is actively getting rid of money but husband isn’t getting any just his sisters.
And now you're filing for divorce. There's no money to split in the foreseeable future and he's resentful that he's been disinherited and bypassed.
He says that he has been disadvantaged in relation to inheritance etc because he has a stepchild and not once asked to divorce but I now have, over a hobby.
Is your mother leaving your stepdaughter money? Does she see your stepdaughter on the same level as her bio grandchildren?
he feels that rather than have one advantaged I want both disadvantaged.
It seems like you actually want your eldest to have everything your youngest does but given the realities involved, that's unreasonable. But if you pull your youngest out of lessons to placate your eldest, yes, you would be depriving her to soothe the jealousy of your eldest.
Elder one is completely distraught and my life is not worth living.
So she's making the home and you miserable because she can't do the same activity. She feels entitled and jealous and I think you've fed that by not being very clear about the financial facts and her expectations. Youngest gets a gift from her dad's relatives. That's it.
What do you think your eldest is going to do when your youngest leaves to go for her custody time with her dad?