My perspective on this comes from my own parenting of a 3 year old. She definitely understands the concept of "mine" and "ours" and she knows the difference between what is hers and what is not hers and what is the family's. But, she has parents. And she knows that her parents set the rules. Just because something is "hers", it doesn't mean that I can't set limits on use. She has some toys that are basically "free play" which means she can play whenever she's not being told to do something else (nap, bathe, eat, etc). And she has some toys that she can only play with at certain times for a limited amount of time. She must share everything. That doesn't mean that anyone can come in whenever they want and take her stuff. We respect her and her things and ask her to share when she's not otherwise fully engaged in permitted play with that item.
For example, say she has a book. It's her book. She's allowed to take her book and flip through the pages and "read" her book whenever she wants. She is not allowed to write in her book, rip the pages, or take the book outside and drag it through the mud. Those are the limits that I set on how she plays with it, even though it is "hers". Because she has shown the maturity to use the books within the limits I set, I allow her to have books. Sometimes, we read the books together (I read them to her), they are still her books, but we are both using them. Sometimes, I might want to read one of her books by myself. I ask her if I can take her book and read it (or say another child asks that). If she's not actively using the book at the time, I pretty much allow her to be open with sharing it with whoever asks. She doesn't get to say "no" just because she wants to. She does get to say "no" to another child when they don't take care of her things (break, not give back, etc), but otherwise, she understands that her things are given to her with the caveat of sharing.
I get that some parents feel differently and don't want to force their children to share things that are 100% theirs, so I recognize that my opinion on "sharing" the ipad with parents is based on how I parent, and not necessarily how the OP chooses to parent.
What my DD does not yet have the concept of is monetary value. She just turned 3 and while she knows what money is and that we have to use to bring things home from the store, she doesn't know the difference between a $500 ipad and a $100 leappad. All she knows is that it's something that she likes playing with. A $5 toy that she gets a lot of enjoyment out of is much more "valuable" to her than a $500 porcelain doll she isn't allowed to play with.
So, in terms of expectations for future gifts, at this point in her development she isn't thinking "Grandpa spent $500 on me last year, so he has to spend at least $600 on me on my birthday." Where we do set expectations is in that just because she asks for something doesn't mean she's going to get it on the spot (or at all) and that wanting something, and having it are not equal. It's just the monetary value of those things don't get come into play for her, because right now, she just doesn't get it.
That being said, I do get the concern in not wanting to spoil your child. And as a parent, you have the right to make these parenting decisions. And your FIL must respect them.
So, for me, the bottom line is that your FIL is rude to purposely push the boundaries that you set and the limits that you pose on your child. You, also, shouldn't tell him that he has to gift the ipad to your family (I get that it was a compromise), just that you don't want him to give it to your daughter because you don't want her to have her own. That's all valid. Everything else, as far as why you don't want her to have her own ipad, is really a parenting issue. We don't have to agree on it.
