Well, I have a lot of experience with bitches and dementia in my family. All I can say is that I feel extra bad for you seeing how you are not even a blood relative to her. Your husband needs to step up to the plate and get her into a home.
I have been a caregiver and still am one (for family members -- and it has ruined my life in so many ways) and my aunt is a caregiver for her mom (my grandmother) who has dementia and she (my grandma) doesn't deserve it for what she put my family and her daughters through. She literally ruined people's lives, as did my parents to some extent. Luckily she is so far gone (mentally) she can't even talk and has no memory, therefore she can't be a bitch. She's just a babbling hunk of flesh. However, she also cannot do anything for herself at all, therefore she is as big a burden now as she was a when she was younger and healthy.
Although she was never a bitch to me personally, I will never forgive her for what she did to ruin the lives of others in my family (and mine, indirectly) nor will I forgive them for letting her. She was a bitch because people let her be a bitch. I do not strip ANYONE of their moral agency who just sat back and let her be a bitch and a conniver just because she was a woman and a mother/grandmother. I was too young at the time to know or do anything. But if she was that way today, I would not let her get away with it. In fact, she probably would not even be in my life. She put my father and my family in hell when she was healthier. Then, when my father dies, she kinda tones it down. TOO FUCKING LATE, THE DAMAGE WAS DONE.
I refuse to help and have any part in giving care to her. Partly because I have my own burden of giving care to someone else, but mostly because she does not deserve my time or anyone else's time. I know it's a burden on my aunt, but I hope that someday she will wise up and put her in a home. But, as in prior years, she does things for her mother (and let her get away with "murder") because she is her mother. In fact, I know (and she knows) that if she put her in a home, the guilt would be so strong for her, she could never bear it. Bullshit! That does not give her (or anyone) an excuse for what she did to others. We like to give parents (especially mothers) a pass on moral agency, but this has detrimental affects on people's lives in a case where the person is morally corrupt. Mother/Father status means nothing when such status is used for abusive or immoral behavior.
I say "especially mothers" because it is a well-documented fact throughout generations that mothers/MILs tend to treat their DILs/SILs in-law like crap. It's usually for no good reason, but they do it because they are allowed by others to do it. Being a mother (or a father) does not strip you of your moral agency! Yet, in our society, we do just that. And it is perpetuated from generation to generation.
She'll be 97 soon, she keeps kickin'.
Don't fall into the "well, I'll just put up with it, how much longer can the old hag live anyway" trap! Your MIL could live until she's over 100. If smoking didn't kill her yet, it likely won't. Hubby and his siblings need to take action ASAP. Things will get worse. Even if she gets so demented she cannot be a bitch anymore, she will not be able to feed, shower, take care of herself. This will be your and your hubby's job if you don't get rid of her.
Good luck. I hope it turns out well so you can get the peace you deserve.