I'm sure it is REALLY REALLY hard not to throw a fit worthy email back at MIL and spew your side of the story.. and I'm proud of you for not doing it.. cuz I sure want to for you!
Don't engage. Don't engage. Don't engage.
Thank goodness your kiddos weren't harmed while he was apparently 'watching' them, drunk. Thank goodness you have been given the gift to see what the reality of the situation is.