All that YOU can do is keep your child away from your SIL's home if you feel the cat is a safety hazard.
The issue of whether or not the cat stays in the home is between your in-laws and their daughter. If they considered it to be as big of an issue that you do, it would be gone. At the end of the day, you can't dictate what people do in their own homes.
As far as you offering to give the cat away, you can't. Pets are considered to be property and the cat isn't yours.