Tips on how to deal with vile Mother in law?

My MIL is utterly vile. We used to have a good relationship, she even delivered my little girl (she's a midwife) but when my husband and I married 6mths ago it all went downhill and she stopped calling, coming round to see her granddaughter and showed absolutely no interest whatsover. It transpired that she's having an affair behind her husbands back with an Egyptian lad 35 years younger than her whom she met on a cruise she went on with her hubby the week before her son and I married. She told both her sons about the affair and that she had no intention of leaving their father who knows nothing about this lad but instead had convinced her husband to buy a retirememnt apartment out in Egypt so she could have the ''best of both worlds'' as she was ''onto to much of a good thing finacially'' with her hubby! Shocking? Yep. Anyway on top of that I confronted her a few weeks ago with my husband asking why in 6mths had she not been to see her 1yr old grandaughter and her excuse was because of my parents.......they live 70miles away from us!!!!! She used the excuse saying my parents were all I ever talked about and she was sick of it. I was disgusted that she should use this pitiful excuse for not seeing her Grandaughter. It got a little heated and we all fell out. I admitted to her that I would accept part of the responsibility for not contacting her to see if she'd like to come and shee her grandchild (but why I should have to ask is beyond me, surely she'd want too anyway??) but she accepted no responsibility whatsoever and it was all mine and my parents fault. She's a bit mental to say the least but now I'm expecting baby no.2 and in all honesty I want her to have nothing to do with either of my children anymore - how the hell do I deal with her. I'd like to just ignore her and never see her again but my husband still wants the contact which fair enough, it's his Mum.