My wife and her mom are tearing each other apart over her dads inheritance and I am stuck in the middle

I (29M) have been married to my wife Emily (27F) for 3 years and until this year I honestly thought her family was pretty ok. Her dad passed away suddenly in January and left their small house and some savings split 50-50 between Emily and her mom, everything was clearly written in the will. At the reading her mom was quiet, just crying, so we all assumed it was fine. A week later she called my wife and said the house was "obviously meant" to be hers, because Emily is young and can just start over somewhere else. She told her to come sign some papers so the deed would be only in mom's name. My wife said she wanted time to think and maybe talk to a lawyer and her mom lost it, said my wife was stealing the roof over her own mothers head.

Since then it has turned into a full on war. My MIL tells everyone in the family that I am greedly pushing Emily to "cash out" even tho it was my idea to let her stay in the house and pay reduced rent while we figure things out. She keeps threatening to cut my wife out emotionaly, sending texts like "you are dead to me until you fix this". When we tried to suggest selling the house and splitting the money like her dad literally wrote, she screamed that we are killing his memory. Emily cries almost every night and keeps asking me if she is a bad daughter for not just giving her half away. From my side it feels simple, it was her dads last wish and she is allowed to keep what he left her, but I also see how destroyed she is. I dont even know what I am asking for, maybe just to hear from people who went through something similar because right now I feel like the villain in my own wifes family story.