OP, I'd respond with two words. Those two words would be "You're welcome".
You have no need to divulge your personal finances. You have no need to lower yourself and get into a pi--ing match with her. As far as the kids, I hate the thought of taking out on the children the sins of the mother...if those kids are smallish, they probably have no idea what their mother does and the whole "point" of donating to a charity instead of buying them a gift would be lost on them...it would just make you the beyotchy SIL who doesn't give anything to the nieces and nephews.
I have a crazy Sis-IL, so let me give you some advice....her goal is to get to you. Crazy people like your (and my) Sis-IL
LIVE to upset people, get a rise out of them, have power over them. The best reaction is no reaction. You don't want to hate her. Hate is a strong emotion and she'll be thrilled to be able to elicit a striong emotion from you. You want to be indifferent to her. Or perhaps, indifferent with a small dose of pity thrown in. After all, what a sad sorry person she is, really, if she thinks the meaning of Christmas is the amount of money one spends. What a sad sorry person she is to be so envious of your happiness that she takes every opportunity to try and take it away or undermine it...And yet she can't. She can't because you know what's important in life, and what isn't.
So OP, get yourself to a place of pity for her, because that's really what she needs. Your interactions with her...welll, keep them superficial. It sounds like whatever other background issues the in-laws have with you are always going to be there, so the sooner you learn how to let it roll off you, the better off you'll be.
Plus...take it from the expert in dealing with crazy Sis-ILs....it drives them nuts when they try to upset you and can't.