wonderz1 you have gotten some great advice here. Even if you think that you have to go through with this and there is no other way. I personally think that at the very least you should get them stuff, but not exactly what they have asked. Eg dont get LV for your husband get another brand of the same sort. This will give your inlaws an indication that whatever they ask they will get.
My rishta was also broken cause of similar issues where I had to stand up for myself and decide that i could not respect this guy and his family cause of the demands that they were making and if I could not respect him then there was no point in taking him on has my husband.
My prayers are with you.
Regards