Good lord, your wife is 100% right and I am surprised she's lasted this long.
What can you do when your mother is mean? Stand up to her. Here's your script.
"Lisa (or whatever her name is) is my wife and while I don't expect you to love each other, I do expect you to respect her. She is my choice and disrespecting her means that you have no respect for my choices."
Your mother is a nasty, narcissistic, controlling, mean drunk. And she's the one who has forced this rift, not your wife.
Inlaws don't have to love each other. It's lovely when they do, but it's not necessary.
What is necessary is them stepping back and giving you the space to have your own lives, and to sink or swim. It also means not actively insulting anyone. Yes, retarded
is an insult, full stop. If your mother thinks that behavior and name-calling is funny, then she's insensitive and mistaken. And her claiming she "doesn't mean it" is beside the point.
If she didn't mean it, then she wouldn't do it.
You are not kids and after 3 years, no one can claim you rushed into things.
Break away from your mother before you lose your wife.
And, I might add, alcoholics tend to not have terribly pleasant ends to their lives.
Step away now, before you're a 60 year old divorced man, changing your mother's adult diaper while she yells at you for not getting her a bottle fast enough.