UPDATE!! (warning, MIL vent included)
Well, we went over to have a ground work session this afternoon. Interesting day. Luckily we had access to the neighbors arena and beings that Lily was full of spit & vinegar and completely neurotic by the time we walked over there, we decided to lunge for a bit. MIL suggested that we start at the "scary end" of the arena and I thought this might be alright because we haven't been there in a while - maybe it wouldn't be as scary as it was in the past. It was still scary. Needless to say a scary place with a neurotic horse is not the best combo. Throw in a few of my MIL's "WHOOP-WHOOP"s in there and things really got fun. So much to Lily's delight I inched my way towards the "safe end" or at least to the point where she felt safe enough and would make a full circle and not try to jump in my pocket (about mid-way). She was full of energy and running like mad so I figured that she'd get tired and calm down and at that point we could inch our way back to the "scary end".
Now MIL is irritated and "firmly" telling me to stand my ground and not let Lily inch her way up. In other words I was doing this wrong and letting my horse walk all over me. Personally, I didn't see it that way and stuck to my guns. MIL then got so miffed that after a few other comments/opinions she told me "go ahead, it's your horse" and walked out of the arena and over to her pasture to check on her horses. Sure enough, while she was gone Lily got tired, calmed down and we were soon lunging in the "scary end" with absolutely no issues at all (this is a first ever for her!). Keep in mind that Lily is fairly out of shape so this really didn't take too long.
Next we spent about 15-20 minutes with my daughter leading her - walk/stop, trot/stop, backing up, going through cones, jogging around the scary end, etc. At one point Lily was doing great and stopped right when my daughter stopped, no "whoa" needed. MIL got miffed again.
"She didn't say "whoa"!"
"That's ok"" I said.
"What do you mean, she doesn't need to say "whoa"??!!" (ie who in their right mind would stop a horse without saying whoa?)
"No, if Lily stops when she stops that's fine."
And so on, and so on.
MIL got upset again, told me all I wanted to do is to argue with her and left the arena again. I guess I probably did get a bit defensive. She just has this way of treating you like you are an absolute idiot if you don't do things her way. AAARRRGGGHHH!!!
Whew! Vent over.
Opinions - was my logic fair in our lunging in/out of the scary place? I do realize that I may have just been being stubborn and standing my ground with MIL. Was I teaching my horse that she doesn't have to do as I ask? My gut feeling is that she was too full of energy at the start to be expected to behave and that as soon as she calmed down we did reach the ultimate goal without incidence so therefor it was successful.
As much as I don't want to cave to my MIL I really do want to do right by Lily so any opinions are greatly appreciated!