I think she has finally won. She has pushed and pushed you and you finally caved in and acted just like she thought you would.
I would tell hubby I had hurt feelings over the graduation thing since she didn't invite any of your family. Then in front of him just apologize to her. Hopefully that she'll understand how important she is to you and your family.
I would then, behind his back since he told you flat out he's not giving her up, start looking for some sort of work out side of the home. Even if it is volunteer work I would not be in that house during the day. I would stay gone until hubby is home on some days so he can see how it was when he left and how it is when you're not there.
Especially after the baby comes. Do you really want to be a grandparent raising a grandchild during the day then when hubby gets home this "model" parent comes into existence so dad will believe what she says over you. You'll be expected to watch this baby while she sleeps, while she watches TV, what ever it is she does in her room all day. She will pawn this child off on you as much as possible. You will become this child's free babysitter and it will be used as power the rest of your life in her family. It will be "IF you don't let me lay in bed all day I won't ever let you see this baby again and I'll be sure and tell daddy that it's your fault he can't see his grandbaby". She is very good at this.
Or she may stay in her room all day like she has been and if you hear crying and her not responding to the baby you'll come off as a "B" if you mention to dad she's not taking care of the baby.
Either way you are screwed.
Taking a job will give you money that you don't have to be accountable for and time out of this situation and will give you a different perspective. It will also give you time to install a nanny cam in several locations. They have them where they are wirelessly hooked up to a specific computer. They store on the hard drive and you can watch them over and over and even make copies on a thumb drive. You will need to make a back up copy every few days just in case there is a storm or power surge of some sort where the computer is destroyed, if you have it all on a thumb drive on your key ring in your purse then no one knows it is there.
Once you have the camera's in good places like the kitchen, family rooms, the hallway her room is in very well hidden too. She may find one then go looking for others. I would just let her do what ever she has been doing. Knowing it was all being caught on the hard drive of the computer.
I would not let her win, she is old enough to sign up for low income housing. She is old enough to be on food stamps and WIC, she can get it now since she is pregnant, WIC will continue for her if she is breastfeeding and WIC will supply formula for the baby once it is born. The child can receive WIC until their 5th birthday.
She needs to decide to move out and be independent. She needs to decide she wants to live somewhere else. If it's your idea it will be seen as mean and uncaring. She is the boss of this house. Not dad, not you.