About that Sister-in-law!
Yes, of course, she has an interest in you. But what is more important in your story is that your wife - of course your wife knows her sister better than you - has not been involved. I would think that it is up to your wife to set your sister-in-law straight.
It is quite possible that there has been friction between the two sisters for a long time. But, as far as you are concerned, you need to discuss this matter with your wife and let her deal with her sister.
