wibble what if you thank her for the offer but inform her that you won't need her there whilst DH is on paternity leave, and that once he's back she's welcome to come down and so she can help during the day, but obviously there just isn't space for her to stay comfortably so you'll get her the details of some places she can stay, did she want breakfast etc options at those places?
I really resent that it's expected you'll have some sort of open house for newborn baby oggling. Last time there were troves of people I'd never bloody met coming through PiL's house (we were living there at the time) all expecting to get a newborn cuddle, and it made me so uncomfortable, I don't deal well with strangers in person at the best of times, but I just wanted to grab DD and hide in the bedroom. It made it so awkward for feeding too, because I didn't exactly feel like I could get my boobs out round all the people I didn't know, so I tried to feed her between guests, and she never wanted feeding at those times.
I remember on one of the days between us coming home and being readmitted, my parents had come with mums cousin and her husband (because they had most of our baby stuff including the crib, and it needed bringing) whilst they were still there and building things and having newborn cuddles DH's aunt and uncle and nan and his two cousins all turned up with a huge box of bits that they'd bought and sat expectantly waiting for me to sit and unwrap it all and have newborn cuddles (I also feel awkward about opening presents in front of people) There wasn't a room in the house that didn't have people in, and then the midwife turned up, I almost cried!! She made a point of being quite loud about how unacceptable and unnecessary all the people were, but no one noticed!
This time I suggested to both mum and MiL that perhaps DH and I needed two weeks with the girls before guests started to arrive and they both said that accepting guests for the oggling was some sort of necessary evil that was non-negotiable
I might have to get DH to send some sort of message round pre-warning people that my 'boobs will be on show, so people of a delicate disposition should probably wait till we've established breastfeeding, but here's a lovely picture of our newborn baby looking just like every other newborn baby they've ever seen...'
Hmm.. early morning ramble essays 