If you are married, having sex with ANYONE other than your spouse is a supreme NO-NO! Having sex with your a word.....ewwwwww.

I would say you should definitely NOT continue having sex with her. It's a betrayal to your wife and will inevitably cause a rift in your marriage and in your wife's relationship with her parents. Your MIL initiating contact does not make it OK. Your wife is likely to be devastated when she finds out. You should tell your MIL that you made a terrible mistake, it was a lapse of judgment, and you need to stop having a relationship with her.

Marc - unless you are trying to get on Maury's show I would end this affair before someone gets hurt.

The problem you now have is how long before your wife finds out because she WILL find out (and probably from her mother). You are in a world of hurt my friend. This is way worse than screwing her sister or friend. Wow.