Do you have a good place you could buy a refurbished older machine? Since your niece wants to learn to sew then I would consider buying a good refurbished machine for what you paid for the Wall-Mart one. I can understand your MIL's concern that if this niece is only learning she may find she doesn't like to sew (heaven forbid) so why spend a lot of money? My youngest daughter tried sewing and doesn't sew now - I tried to give her one of my FW's for mending and she turned me down (she is 28). My husband's mother was good at finding something cheaper than the one you want. When DH and I got married he wanted a specific electric razor, but was willing to settle because the one he wanted was $50.00. One thing my dad told me was get the one you want or you will not be truly happy with your purchase. That does not mean to buy the most expensive but do your research and buy the one you want. He kept that same razor for 20 years because he could replace the blades when needed. You will be happy and more likely to keep it longer. But depending on age my MIL was born in 1926 and truly grew up during the 1930's which was not an easy time anywhere.
Does your niece know what she wants? Does she want multiple stitches? Or just go straight and reverse? I did read the reviews on line and they were not horrible. One person said she did not believe it was a good machine but everyone else said they would recommend it. So once she gets more advanced and ready for a better machine she can do the research and decide what her needs will be. Just let her know threading the machine properly, putting the bobbin in going the correct direction and replacing the needle the correct direction will make a huge difference in the was the machine will perform. And if it really does not perform well, then she can return it.