H.A.
I can understand your frustration on this one. In terms of the "spongie thing" I think you could take it out whenever you want - unless you are using it for a medical reason and then I would check with the doc. If he is a healthy baby, I wouldn't think he would not even "need" it. Our daughter never used one of those, unless she was sick and then it was still only for a week or so - on and off.
For the milk intake, my first question would be...how much milk does your daughter WANT to drink? Forcing milk on her is not going to be the answer because that will just upset her and cause a power struggle. Given that, I would also ask how much juice she is drinking. If she is drinking a lot of juice and doesn't drink much milk, she is probably filling up on juice. Having said this, our daughter has never been a big milk drinker either, and the only other thing she has is water. She is in the 25% for weight and our doc is perfectly happy because she has always been in the 25% for weight. As long as she is growing, that is what really matters. I also agree with another poster that commented on the nutrients are what are important and not necessarily the cow's milk itself. There are a lot of people who will argue that cow's milk is not all that healthy - but that is a different discussion for another day.
More milk is not going to hurt her, but it also is not necessary to load her up on it thinking that she needs it to gain weight. If your MIL is looking for increased calorie intake you can always add other "good" fats to her diet like olive oil, full-fat yogurt, and cheeses. That will serve the purpose of the calcium and the added calories.
Good luck!