Been here, done this...
Ad nauseum.
I think your SIL must be a clone of my cousin Janet. She will be on her SIXTH marriage later this summer. I have declined to attend, because I won't continue enabling her on-going drama. I have better things to do with my time--like grout my tub. (Yes, I'm a mean, vindictive witch.)
Here's my 2 cents.
If your hubby is willing to be in the wedding, then do it. It's his sister, so it's his call.
Since your husband is also anti-gift, I'd let him make that call as well. He has decades of experience dealing with her selfishness that have led him to making a this decision about the gift. Here's how the scenario will play probably out.
She will notice that she didn't get a gift from you two. She will make a scene at a family gathering (maybe even the wedding reception itself!) at which her brother will respond with wide eyes and great surprise, "Sweet sister of mine, I didn't think you expected one, since you didn't give US one." An argument may or may not ensue, depending on just how sincerely surprised your DH manages to be. Perhaps on your next anniversary, a gift will arrive from her--so that she can expect a gift on HER anniversary.
Think of it as social NILIF for the selfish. (Keep in mind that I'm vindictive and horrible.)
I have been thru the "I didn't get anything from you" scene with Janet at least a dozen times at various family functions. People like this can't be "golden ruled" and treated as you would like to be treated yourself. They have to be "market valued" and treated exactly as they have treated you. Otherwise, the problem with their behavior never occurs to them, and they continue to walk all over everyone.
The last time I saw Janet, we hadn't spoken in well over a year. She gave me this puzzled face and asked, "Why don't we talk anymore?" I said, "Because you didn't return my last 3 phone calls. I thought you decided we weren't talking!" excused myself, and walked away from her. We've talked about every other month since then. But I no longer call. I'll call her back, if she leaves a message, but it's on her now to make the effort. She's on my list of people to forward email jokes to, and that's as contact agressive as I'll be for now. Maybe next year I'll call her for her birthday.
Some people, and it sounds like your SIL may unfortunately be one of them, just have absolutely NO capacity for empathy. It's not that they're necessarily bad people--Janet's not bad, she's just narcissistic. And narcissists simply don't have the capacity to understand any feelings other than their own. But you can sometimes get one to understand YOUR point of view by making it THEIR point of view. And that can at least make it possible to communicate. Your DH's intention not to give her a gift may be his only way of making her understand how badly she made him feel when you two got married and she didn't give him anything.
But if you don't see her often enough for it to matter if she walks all over you, then buy her a $2 Hallmark card and put in a $10 gift card to Linen's and Things.
