S.H.
First of all, I totally don't agree with what Sharon (another responder) said to do. I'm sure you know, but you never hit another person's child whether they're related to you or not. Second of all, I agree with another responder that you should inform your husband about setting the ground rules even if it means that you're the "bad guy". It is your home and you have every right to discipline her son the same way you would discipline your own. If she takes a moment and looks up from the TV to say anything to you, you should be blatantly honest with her and tell her that her son's behavior is not tolerated in your home and if she doesn't do anything about it, then you will continue to discipline him on your own. Your nephew will come to respect you for laying down ground rules for him in the house. Even better, it might even light a fire under your SIL's butt to get moving and get her own place. I think that whether your husband agrees with you or not, you have every right to say something to her...at least about sitting on her butt all day and then leading into the lack of discipline of her son. Kudos to you for even allowing your SIL to move in with you and your family. You must be a saint with never-ending patience! I'd be bald from pulling all of my hair out already! Good luck!