I would give them a picture with a note saying that the quilts will be coming. I've done that for my son when a gift I ordered didn't make it in time and he was just as happy as if he'd gotten the gift. Getting a quilt for Christmas is wonderful and I'd bet your BIL and SIL will be tickled knowing that such a terrific gift is coming their way.
I would be totally bummed about the machine and probably saying very bad things. The idea of getting a loaner from the repair shop is a very good one, any chance of that happening?