How do you let you mum-in-law know that you will be calling the shots on the upbringing of your child (without sounding rude)?

Speak to the husband and discuss how you are feeling and make him understand the gravity of the situation. Ask him to be involved in a casual sit-down where you can initiate this discussion and indicate to her that you are not comfortable with her calling the shots. Make sure your husband participates in the discussion for it to work.