Hopey, My inlaws live some distance away, so we are in a similar boat to you. In fact we spent our honeymoon with them on their small boat for a week - and our marriage survived. When we had our first baby, aged 4 months, we did another boat holiday with them - a canal boat during a rainy week in september. We have also spent annual holidays at their place and 90% of the time we all get on very well.
This is due to a deliberately non-interferring MIL. I know this is luck.
But what's less to do with luck is the fact that there is a rigid division of labour between MIL and I. She made the rules, I happily followed.
She takes charge of all domestic stuff, shopping, cooking, and most cleaning. I take charge of the children. It is my job to make sure they are happy, clean, reasonably well behaved, sleep when necessary, don't interrupt adult meal times ( if possible), don't break anything and don't leave a mess. Occasionally we help each other out, but MIL is far more expert than me in the kitchen, so I leave her to it. Sometimes she'll babysit or take the children out.
Dh and I take the children on trips just enough to give MIL and FIL a break, but not too much, otherwise MIL and FIL feel done out of their precious time with them. We tend to talk through our daily plans at breakfast, so everyone is happy. Mobile phones help, too, of course so when you're out,you can check on meal times or changing plans.
I have come to expect little hands-on help with, ie nappy changes, but I know MIL loves our sons dearly and really looks forward to having my 7 year old for week-long holidays by himself. She says she will happily have our youngest as well once he hits four-ish.
I know exactly where I stand with my MIL and I think this is why we get on so well. We do have niggles, and I think she is sometimes in quiet dispair about the mess we leave. I sometimes get irritated at the correctness of her approach to practical things. In my own home I'm far more slapdash. But we rarely voice criticisms of each other, and if one does, the other backs off.
That's my other suggestion. Make sure you can get away with the children and/ or with your husband for a while each day. Be nice, but make it clear to your MIL that you won't be constantly around during the holiday, and you're open to any offers of babysitting.
If your MIL is keen on planning this holiday to a tee and is phoning you all the time, just let her get on with all the practicalities - it's likely she's got more time than you. Make sure sure she knows you're gratful for her efforts - a bit of diplomacy can't go amiss.
If you sense she's trying to take over your role as mother as well, make it clear in advance that this will be your area of responsibility, and you'll also be doing some separate things with the children.
I don't know if this approach will work for you, but here's hoping.