Was this rude? (long, sorry)

I think it was hurtful to the FIL’s daughters and also very petty of MIL. Why not have all of you go together? Were the daughters guests in her home at the time?

It doesn’t make sense to me to not invite them. She sounds a selfish woman who I would avoid. All you can do is behave politely, shame her with your civility, and avoid her whenever you can. I would also extend a friendly hand to these daughters, just so they know that it’s not a them vs us thing. But maybe they already know that.

Trust me–I have a MIL just like her (except she doesn’t gamble).

One thing that wasn’t clarified…was this the day after FIL died?

Had most of the potential dinner guests travelled from a distance to be there for a funeral? Or were most of them in town people?

It seems worst to me if this was the day after he died and the excluded people were out of town guests (I guess it’s even worse if they were house guests than if they were staying in a hotel)

You have my permission to add this to your list of grievances. She sounds like a bizarre woman. (though I do like to see the recently bereaved cut a LOT of slack)