I can understand what you are feeling jennchip.
For most of my adult life, I stayed in the distructive workings of my own family. My parents weren't alcoholics but my mother grew up in an alcoholic home . She was/is a very mentally ill woman who I nearly killed myself to please.
No amount of anything I did was good enough or right. It helped me to become naive to the workings of predatory people. I dislike the word codependent so I rarely use it. I own my issues. The label just doesn''t sit right with me.
My friends and romantic partners were all abusive. My current relationship is with an A. I had never been with an A in this way before in my life. I have to say that being with him has been the most concentrated torment I have ever lived through as compared to the people of my past. I made another attempt at ending it today and am working on no contact myself. I know how hard it is when we doubt our decisions and wonder if we are the ones who are wrong.
Having given some of my history, I say you are not wrong for having no contact. You are blessed in that your husband is on your side. My A refuses to take off the rose colored glasses and see the truth about his family. His ex and his parents are all active A's as are his former friends and his eldest was put on permanent probation for getting drunk within the first month of college. One more time and they will expel. He refuses to have no contact so he can really face himself and work at being sober. That is one huge reason why I said enough.
I have found that most people cannot fathom how walking away from toxic people no matter what the ties or connection is the only choice one can make to have the life , health and happiness you need to create in your life. I have cut contact with my mother and others in my life who were not healthy for me. Being blood relatives doesn't give anyone the right to abuse or be toxic to their own kin.
Your mother-in-law has already given you way more that justification on why your no contact is a healthy choice for your family. Please don't let anyone shake your judgment because unless they are in your shoes, they have no idea what is best.
Also, please don't let her guilt tactics get to you. It sounds like if she were to actually support you, she would have to face her addiction issues and she isn't willing to do that.
IMHO, you are 1000% right in keeping the ones who are not doing anything but causing trouble far from your attempts to work on what is best for you family. You are also helping your children learn how to set boundaries and not put up with harmful, destructive behavior. It is a gift that will make a huge difference in the years to come.
I wish you all the best.