Knitterly, maybe my own experience with this will help a little, even though it's not exactly the same situation.
My parents are very religious also. My mother did do Santa with us, but we knew from an early age that Santa wasn't a person - Santa was the spirit of giving. As Mom always said, "Anyone can be Santa." Since it wasn't a matter of believing in an actual person, we continued to get gifts from "Santa" every Christmas until our late teens. We were happy to play along, and we never felt lied to. In fact, when I was around 9 or so, I insisted that my parents get stockings so my sister and I could be Santa too - we would buy small gifts with our allowance and fill Mom and Dad's stockings before we were sent to bed, and they always promised not to peek in them before morning. It was a great lesson in giving for everybody.
I know your daughter is too young to get the distinction now, but if you tell her something like this when she's old enough to understand, then it won't matter if your mother tells her Santa isn't real. She'll know better.