So many things I want to say, not sure where to start. I did have lessons to address my confidence issues. I have already booked more. I called my parents because I was shaking and panicking after it happened and wanted some support. DH called his because it is OUR car and he was there when it happened and he was angry at me but didn't want to let it show. He also fully believes FIL wants a better relationship with him, so he tries to involve him.
Re accepting the money: I agree we shouldn't have. I have tried to explain on here before, but it's really hard to convey how these situations go. FIL offers to pay for things which would make our lives much easier but which we could manage without (wedding breakfast, car, house deposit). We think (hope) there's no harm in accepting, because we could manage without, and this is his way of helping. Then FIL is an arse about how we spend it. It really doesn't feel like he is trying to help, because he never asks if we want something, it's always on his terms, making it feel like he just does it to control us. The one time we gently suggested we didn't want to accept his offer of money for a deposit because we weren't even considering buying a house as we couldn't afford to save up for it, it got really awkward really quickly, he seemed offended that we didn't want his money and starting sounding really unpleasant. We accepted his money, but we haven't been able to add to it yet, so it's just sitting in an ISA.
FWIW, MIL immediately lent us £1000 on the understanding that we will use it for a car because she didn't want us to struggle. That was done out of kindness and didn't create tensions.
I know our financial situation is messed up, we're working hard on dealing with that. FIL is difficult in many other ways too, he can neither control nor express his emotions in a mature way. He does care about his children (according to DH), but has a funny way of showing it. A few years ago when DH finished his degree and our lease was up, FIL came to visit and insisted on seeing DH alone. All he did was tell DH he needed to get his life sorted in a really unpleasant way. I was there to witness him saying "You're going to end up in the street, no money, no house, no job" as a means of saying goodbye. Sure, I suppose he was worried, but FFS. He's never had faith in our ability to manage our lives and he won't even give us the benefit of the doubt. He thinks we're losers and no matter what we do, it doesn't seem to be good enough.
I really don't think it is about wanting to use the money for other things, he's so rich £3K is small change to him.
I really want to have the inevitable fight but DH just wants to keep hoping things will get better. The only time they did was when DH stood up to FIL when he was trying to take control of our wedding planning with 0 consideration for our wishes.