ESH.

I can completely understand your reasoning but I think you may be being a bit overprotective and dramatic here. The child will need to be exposed to people at some point during their life. The pandemic is waning down and we have many effective treatments, vaccines, etc. if you are very worried, require people be vaccinated to attend and set up sanitizer stations and hand out masks.

Remember that this is your husband's mother and not being accommodating to a very simple dying wish might make him think of you differently and harm your relationship. This is also a memory for your child who will not have her in their life very soon. These are her blood relatives.

I think you need to be flexible here.