I felt a lot like this when my oldest was born. I think my MIL was just trying to help, but all I heard was unsolicited advise. She seemed shocked that I was capable of doing anything without her help. She would take my son out of my arms if he was crying. I was miserable.
I knew that part of the problem was that she just always told people what she thought. Good or bad, she felt it was her responsibility to say what she thought. My husband and his siblings honestly don't respect that about her. If they don't like what she says, they just ignore her. Personally, I think that only causes her to be more persistent.
Part of it is that she honestly wants to be helpful and needed. Maybe needed more than helpful. She wanted me to need her to tell me how to be a mom (as if my own mom was useless).
What really helped my situation was for me to "need" her once in awhile. I come up with a list of things that I could ask her advise on - things where she would never know whether I took her advise or not. I would ask her what books she read her kids when they were little or what songs she would sing with them. Anything I could think of that didn't affect how I was parenting my child right then. This helped a lot because she still felt needed.
I'm not sure if your concern about pacifiers has to do with breastfeeding or not. If that's your reason, I would really try not to worry about it. I know some will tell you to stay away from bottles and pacifiers for weeks or even months to avoid nipple confusion. Maybe that's true of some babies, but my oldest had a bottle withing an hour of his birth and a pacifier shortly there after. He was in the nursery for 10 days and was bottle fed most of the time (I breast fed when I could). He never had any trouble breastfeeding. My youngest didn't have his first bottle until he was 3 days old. Same thing - absolutely no issues going back and forth.
They both quite using the pacifier around 4 months. It did nothing for them, but all kids are different.
Relax. Try to remember that you are the mom for life. If your MIL wants to help out right now, take a nap. You won't be living with her forever, and your little girl will always know who her mom is. She may also love Grandma, but you are Mom, and no one can change that.