I'm probably being super emotional, overacting, ridiculous about it, but it's bothering me to no end. My MIL called me to see how I was doing because I'm overdue and she referred to my child as "the little sh!t." I'm sorry, but that really, really bothered me. Don't call my child that. If she had said, "the little stinker" it wouldn't have bothered me, but I just felt that it was so harsh to say that. If I'm overreacting, and overly hormonal please tell me and I'll let it go, but it's upsetting me. This is also the same woman that basically told us she's not as excited about this baby as her other grandchildren and was disappointed about the gender of the baby. My husband's response was, "That's just how my mother is."                   
                             
        
Re: Am I overreacting over MIL's comment.....
DH and I are friends with a couple who are very anti-children (well, we're friends with him, but we can't stand her. Despite her constantly talking about never wanting to have kids she sure has plenty of pregnancy advice for me!) They think it's really cute to refer to my DD as the "parasite" or "flesh monkey." Usually I just say something like "We prefer to call her Lily."
If your MIL is saying it to get under your skin, she succeeded, don't let it bother you. Other fish to fry!
Based on her comments she sounds rude, next time just say something like no my baby is not a shit, and please don't talk like that about him/her ever again, THANKS!