People like to feel needed. Grandma feels needed by SIL and her kids, and that is why you are unlikely to see much change here - she's getting something out of those relationships, in a big way. Yours, not so much. (Not to sound uncaring.) It sounds like your family is more independent, and that, combined with distance, means the depth of the relationships aren't as strong as they are with them. I doubt that it means that Grandma doesn't love your kids. It just means the dynamics are different. But I do agree that it seems to bother you more than anyone. And I can understand that. I think that rather than trying to "beat them", you should "join them". By that I mean, become part of the family rather than always trying to be separate. Have some fun with everyone. Do things together. Join in. Make memories. I know you probably don't exactly enjoy being around them, but the alternative doesn't seem to be working too well, either, and time is going by. I think "joining in" is the way you can get what you want for your kids. Grandma will undoubtedly embrace it since she obviously likes seeing you all together.
I agree with this.
As others have said, your MIL is going to be closer to your SIL's kids just by virtue of them living closer & having more of a "day-to-day" connection.
Also, keep in mind, after having not seen someone for a while (weeks, months, etc.), it takes some time to reconnect & start feeling more comfortable & "easy" w/ one another. And, just when everyone's starting to feel comfortable & more at ease, it's time to go!
While your MIL sees your SIL's kids on an every day basis & has immediate connections & things in common w/ them, it takes a while to reestablish those connections w/ your children. The same every day ease of knowing each other & knowing about each other & have established ways of every day connection is just not there.
Plus, as you've said, your SIL & her kids NEED your MIL. Your MIL is part of their every day lives & routines.
In my family, my sister needs my mother more than I do. Her kids are at my parents' house on a weekly basis. Now, my parents are wonderful (sometimes too much) when it comes to their grandkids, so my kids don't feel slighted at all; however, they just don't have the same day-to-day contact w/ my parents than my sisters' kids do. It's just the way it is.
W/ DH's family, while we live in the same town, 2 of this brothers' families live much closer, so their kids see DH's parents more frequently than our kids do. One of his brothers & his wife & their son have dinner w/ his parents every Monday & Wednesday evening.
And many, many times if we are at DH's parents house, a various combination of other family members are also there as well.
But the kids don't care & probably prefer it when the other cousins are there - more people closer to their own ages means more fun for the kids. Your kids may be the same way!
DH & I tend to be a bit more independent of our parents. Plus, our older DD is 15, & our kids can stay home by themselves. We don't need babysitting any more. I can take our kids to their various activities w/o needing help from my dad.
But my kids know their grandparents love them. We know our parents love our kids.
Additionally, grown daughters are normally closer to their mothers than are grown sons. I think a lot of it has to do w/ how women communicate w/ one another. I just talk differently w/ my mother than DH does w/ his mother.
In life, there will be lots of things you can't change. You can only change your actions & reactions. W/ your MIL, it is what it is. It's not a toxic relationship. She's not doing anything purposefully to hurt your children.
I think maybe coming to the realization that your SIL & her kids are just part of the "package" will help your outlook. Like Pea-n-Me said, when you're there, just join in & make it an "everybody together" kinda thing instead of trying to ration your MIL's time.
If you're at dinner & your MIL is sitting w/ your SIL & her kids while you're sitting w/ your FIL, then make some memories & have a wonderful conversation w/ your FIL. Help your kids develop a good relationship w/ their grandfather. Let your DH have some quality time w/ his dad.
When you visit, bring a couple of board games or craft activities that all the cousins can do together. Bake & decorate some cookies together. Bring a new movie & some popcorn that everyone can watch together. Your children's memories don't just have to be of one-on-one time w/ their grandmother.
Also, your MIL may be at a loss at how to proceed or what kinds of things to do & just need a little direction.
Family dynamics are different for everyone. Hope this helps some!