i scrolled through and don't see any comment from 'woodbridge.'
it's hard to tell from your post if you have a fear of pits, or if it's your BIL who is causing you concern.
regardless, if you don't want your kids around the dog, it's your call. i don't really get why people bring their untrained unsocialized animals with them everywhere, but it does seem to be a thing. our granddogs do come over, but their first meetings with new people and new animals are always carefully overseen, and we don't have small children.
yours aren't toddlers, though. at 5 and 7 surely they're old enough to know not to run up and hug a strange dog?
i've become very fond of pits (one of my granddogs is a pit, and we think our new pound dog has some pit in her) but the statistics are what they are. they are super sweet ponce-wonces, but they are very protective of their humans, and their bites (on the rare occasions they do bite) are dire. if your BIL doesn't work with his pit or socialize it, i think your worries are at least somewhat justified.
i think in your position i'd decline a big stink, but be calm and firm and very minimal in my discussion of it. probably best to limit the discussion to your MIL. and to leave his parenting out of it. it really doesn't illustrate anything about how he handles dogs.
'we're really looking forward to spending some time with you, alicia, the kids are excited about it. i'm not going to permit them to be around Spike until i'm comfortable that he's been trained and vetted around kids, so we won't be over this weekend. can we schedule a time for just us and the kids to visit? or would you rather come here?'
no excuses. no long explanations.
khairete
S.