I feel for your inlaws.
I agree with pp stay out as best you can but assist your inlaws to get out of this situation. Offer support for them to do so.
And if your DH has to step in, then he should. However his parents must agree they need this support. I'd hate for your DH to speak to BIL and his parents (through fear or need to smooth things over) tell BIL and SIL they don't agree with your DH. That gets messy all around.