It doesn't sound as if your MIL deals with disappointment very well. She will have been very excited about this baby whilst waiting for it and has pictured her Grandmotherhood as being very different to the way you want it. In that respect, I do feel that you can be kind about the way you handle her. I would acknowledge how disappointed she might be but point out that you are also trying to do what works for your family. I would have a straight conversation about her advice but point out that the best advice is where the offerer recognises that you are at liberty to take it or leave it. If you can find a way to thank her and act on advice on stuff which really doesn't impact on you and baby much, whilst being assertive on stuff about sleep, feeding, etc., you might find that she is more manageable. I would also point out that you are probably more sensitive to some of this than you need to be simply because you are more than likely tired, overwhelmed with the newness of it all coupled with the changes your body has been through and the hormones surging through you.
Many people, Grans and Mother's alike, find the path through family relationships after the birth of a baby, extremely difficult. Recently my sister, who has many faults but is usually well meaning, overstepped the boundaries with her new grandchild. Whilst her son was complaining bitterly and wishing she was more like me, I pointed out that with my own daughter I had experienced a similar scenario and it was a hard lesson to learn. Fortunately my son got wind of the likely fallout and was able to alert me. I was very surprised, more than a little hurt because I thought my daughter would know I always had her back and was helping her but extremely grateful that I could mend fences before it went horribly wrong.
Of course, at the end of the day, it is your child, your and your husband's rules and it may be that, if you can get through this difficult time, you let your MIL interact with your child with your husband and you have some free time.
Good luck.