"...MIL has always been horse crazy, but has never really had the time or money to ride,..."
"When are you going to have the time to train your own horse? Come on. Let's get you one that's already trained and that you will enjoy a lot more."
"Training takes time. Don't you want to ride sooner?"
"Do you want to end up with a broken hip?"
That's when she said to me "Oh, I could never pay that much for a horse! I want a free horse, like the one you got."
"You get what you pay for."
"$1500.00 is what you'd be paying for a good many years of happiness and the assurance of a horse that you can ride and won't kill you."
"You're not going to find another horse like the one I have."
"She's already hinting at getting "family discounts" for trimming and shoeing..."
"Trimming my own horse is hard enough. I can't do a second. It'd kill my back."
"And if your untrained, $400 that you don't have time to train...decides to kick me?"
And here's a good one: I usually try to avoid this and help everyone find ways to take care of their horses, but if you're really trying to get her to not want a horse...get her to not want to hurt a horse. What I mean by that is, emphasize that if she can't afford the horse, she can't afford the care that the horse will need. Shed some light about taking care of the horse's diet and what all of their needs are, not just hoof care. Use lots of juicy science that overwhelms her brain with the complete opposite of what she wants to hear: "that everything will be fine!" Nothing kills that mystical, magical 'very own horse' stuff like figuring out your lack of funds would end up doing harm to the horse. She might go for just accepting that it's better for others to be responsible owners, and she take lessons.
Otherwise, ACinATX had very good advice about a difficult lesson horse. Just don't orchestrate that, and then your MiL gets hurt. That's not good for either of you.