This is a hard one because the fmil is not being fare to your friend and her daughter. Here is the best suggestion I can make...Have her and her daughter join wedding forums. Forums are usually very good at coming up with great ideas on a fixed budget. The mother might also tell her future future son in law what is going on if he doesnt know and what it is doing to his fw and fmil's relationship. He may be able to shed some light on the probem.
Best of luck!