Two of my daughters were born in August... #1, I sent to Kindergarten when she turned 5. Several years later, we made the decision to have her repeat 4th grade.... not because she wasn't smart enough (she is now working on her doctorate at Johns Hopkins University), but she just needed some extra time to mature. The other daughter, we delayed her entry into Kindergarten. She, too, was "smart enough", but I again thought she needed another year to mature.
There is rarely an advantage to being the youngest in the class... but there is more often an advantage of being the oldest.....
One thing... don't let your MIL sway your decision... make the decision based on what YOU know is best. My sister was "disappointed" that we had our oldest repeat 4th grade... she thought it would have been neat for her to graduate as "class of 2000" .... as it is, she graduated as "Class of 2001", which technically WAS the first year of the new millennium.
Think of it this way... many school districts base their entry on September 1st......(our district in Texas is this way)..... if you lived elsewhere, she WOULDN'T be able to enter yet!