I'm sorry to say that I think your DH is the problem, not your in-laws. He sets a boundary then sits back and watches while they trample it, does nothing, and warns you not to do anything either because he's afraid they'll
off? From where I'm sitting you've got two choices. You can throw in the towel and plan on allowing her to dictate her relationships
with you, your DH and your DD forever, or, you can stand up now and let the chips fall where they may. If she wants to throw a fit and refuse to acknowledge you then let her, but make darn sure she's aware that you will not be sending your child anywhere her Momma isn't welcome.
If she's blocked him how does he know she posted a new pic? Someone told him? Someone who is concerned or who wants to stir up drama?
I think he needs to bite the bullet and email her "Mom, I heard through the grapevine that you've been posting pics of DD on Facebook. As you know Syrse and I have asked everyone not to put her photos online. I tried to access your Facebook page to see for myself but it appears you have blocked me. It feels like you are sending a message - 'I'll do what I want and if you do 't like it, too bad.' You should be aware that my response to that is 'Respect my boundaries with regard to my family or I won't bring DD over or share her photos with you.' I hope you choose to respect my wishes. I would like for you to have a close relationship
with DD but that's up to you."