I was asked by a previous co-worker if I would make a baby quilt for expected first grandchild. I told her that she would have to buy all of the materials ... including batting, backing (funny how one who doesn't sew quilts forgets about the backing material!) and thread. Then I told her I would only charge her $125 to make the quilt. Also told her the time frame I needed to do the quilt. She agreed and selected a pattern. I went over the pattern with her and she made a list of what she needed to buy. Well time went on and I hadn't heard from the woman, so I emailed her to see how she was doing with her fabric hunt. At that point I even offered to help her shop for the fabric. I also reminded her that time was getting short. The reply I received was that she didn't have time to shop for the fabric and she wouldn't be able to pay the $125. I thanked her for her reply and to tell the truth ... was very happy I put things in her ball park. I may be retired and I may love making quilts, but I don't like it when people assume you have nothing else on your plate. That you are just waiting for someone to ask you to make a quilt and you jump.
My opinion, if you really want to make this particular quilt, is that you have your SIL buy everything for the quilt & pay you labor. You wanting to make a gifted quilt is another story, but this is a requested quilt ... not a gift.
Good luck to you!