It's simple human nature to defend oneself and "spin" the details to show how you are right when somebody tells you you're wrong. Your MIL does it, and so do I, and so do you. NOBODY can respond to being told what they "need" to do. And it prevents any of us from seeing the situation from another point of view.
So, if you REALLY want to be able to communicate with your MIL (and I'm not saying it's necessarily realistic to "want to talk to her about everything"), there is a great communication technique you can learn called Non-Violent Communication, or NVC. You can google these terms for more complete explanations and tips, but here's one application of the basic process that might fit your situation:
1. Listen respectfully to a criticism from your MIL (a challenge, but possible), and observe/summarize what you believe she said. Use non-judgemental language. "I hear you suggesting that because I do X instead of Y when my child does Q, you are worried that I could be harming this grandson that you love so much. Am I hearing you correctly?" Be prepared to adjust your statement until you are saying something you can both agree upon.
That step alone could surprise your MIL: she will feel the unexpected satisfaction of your attentive listening; she'll have her care for her grandson acknowledged, she'll see adult-to-adult communication modeled in a way that has perhaps never occurred to her as possible; in short, you will be meeting some of her emotional needs. She may even feel some sympathy for you as the well-meaning recipient of a harsh or narrow judgement.
2. Make an observation, and report your genuine feelings about it. Make sure you state feelings ("I feel mad, sad, glad when…") and not concepts (I feel you don't respect me when…"). Feelings just are, and are hard to argue with. Concepts are often a point of argument. The concepts come in a later step, stated as needs. First, get real about your feelings. Example: "I have noticed that you could be speaking to small child with that tone of voice. When I hear that, I feel furious, frustrated, and confused."
3. Tell what needs of yours are going unmet, such as: "You know, MIL, just like you, I need to be heard. Just like you, I have a longing for respect and consideration. I need to have my wisdom supported, not attacked. I want to learn how to strengthen the family connections that are becoming frayed. I want my children to experience a well-connected extended family.
4. Make a request that is within your MIL's reach. This might include: "I hope you will help me figure out how we can achieve that. It must surely be possible that there is more than one solution to a child-rearing problem, and so I want you to give me space to deal with my children the way that seems best to me. Here's a parenting book I've found useful. Will you read it too? Maybe we can find some common ground to build on."
My best to you, S.. You sound like a caring and conscientious mom. I hope you find a solution that works for this very common problem. NVC has helped me with interpersonal problems with my family.