Fair enough that your tastes are different to your MIL's, but if it bothers you this much - best to move out. She is doing you and your hubby a favour by allowing you to live there, and it would seem ungrateful if you start changing the decorations in the nursery. She may not be doing this to p*ss you off, it may just be that she is excited at becoming a grandma and is loving the opportunity to decorate a nursery. It might be your baby, but it's her house, so realistically, she can decorate it any way she likes!!
Is there any reason why you can't still have your belly cast and the canvas in the room? Is there a middle ground? OK, you might still have to put up with the bears, but in the general scheme of things, is it really such a big deal? Perhaps ask yourself if it is actually a sign of her being overbearing and controlling, or is she just trying to be nice? Who hasn't received a well intentioned present that sits in the back of a cupboard because it is too ugly for public view, but which gets dragged out and put proudly on display whenever the giver is visiting? It's a bit harder because you are living with her, but think about her intentions before reacting, otherwise you may hurt her feelings.
Decorating aside, if she is showing signs that she will be overwhelming with helpful hints or try to take over when bubs is born, this is something that you should address. First time grandmas are also learning the ropes, and don't always get 'helping' right, if you are able to work on a good relationship with her early on then it will be much easier to deal with if she is giving advice whilst you have a screaming baby - which is when it is difficult to remember that the intentions are good, even if the timing is bad.
If she is generous enough to be buying the 'big' things, perhaps suggest to her that you have some ideas of what you would like and to go shopping together - it will be a nice way to bond.
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