My DH has a four year old neice, who is really lovely, but hard work, to the extent that ADHD is wondered about. She is mad about my 11 month old DD, but won't leave her alone. Always grabbing at her pulling at her, jabbing toys at her...
My MIL adores DN, shows obvious favouritism and does a huge amount of caring for her. At dinner in our house to celebrate the New Year, DN was told off several times (by me, DH, SIL) for upsetting or endangering my DD. Then she went too far, grabbing her suddenly and roughly, terrifying the baby, who howled. MIL had been holding DD at the time and did not seem to react.
SIL was close by and tried to discipline her daughter, MIL responded by telling off SIL, saying that she had control of the situation, and then affectionately spoke to DN. My DH and I were really annoyed, because it seems that MIL can't be trusted to control DN around DD. Also, if over rules me like that, when I try to correct my DD in the future, I won't take it well!
So, would it be unreasonable to refuse to allow MIL to take my DD when she has DN? I get on well with her and do trust her generally, I just think she has a blindspot when it comes to her other grandchild's behaviour. I will just try and avoid it being an issue for now - but sooner or later it will come up, and probably hurt MIL's feelings.