Breakfast is usually the least expensive meal, If you are looking at any buffet meals then the cost between L and D is usually the same and the only ways to get a little savings out of a "lunch" is to book the latest slot for breakfast. For example Tusker house will have breakfast until 10:55, so you book at 10:45 but lunch items are brought out around 11:00am. So in this situation you get breakfast price but lunch items. But are you going to want to take a break at that time?
Honestly there is not a lot of savings to be had between lunch and dinner. If a regular TS restaurant and not a buffet your savings would come from not ordering and app, entree and dessert. Just order an entree and a water.
The biggest savings will be with the TiW card and for that group of 8 you will definitely get your monies worth.
I'd tell your mother in law not to worry about it. Disney does not operate like your local restaurants which might have different menus for L and dinner. Just pick the restaurants you want to go to and book them when it fits into your schedule.
If she is being a real stickler then just price out 2-3 restaurants that you are interested in with the same items ordered from a lunch menu vs dinner. Add in your TiW discount and show her that it really doesn't make that much of a difference to restrict to only eating lunch. Honestly if she is unwilling to budge then you can let her know that she is free to eat lunch meals while the rest of the group might eat dinner that day, BUT she will not be entitled to your TiW discount. MIL can sometimes be difficult to reason with.
Unfortunately Disney is expensive and the only way you could save a considerable amount of $$ on food would be to have a villa where you can prepare meals, pack lunches for the park or only eat quick service. Traveling to WDW is a vacation and you do splurge on vacations.
There are ways to save over all :
We have found that having quick breakfast items in the room is a great savings in money and time. Eat something quick and you can head off to the park. Look into some grocery delivery services - I like
amazon prime now.
Then pack some snacks for in the park so that you are not always having to buy snacks.
Another route for savings would be to start buying discount Disney gift cards from target. With the target red card you save 5%, so the savings does add up.