If you overstay B2 visa for even one day (I-94 date), per law the multiple entry B2 visa will be automatically cancelled under
INA Section 222(g) and you have to go back the US embassy or Consulate in home country and reapply.
You might think of leaving and reentering the country via Canada / Mexico. But that is dangerous especially when your friend's MIL had stayed in the country for close to 12 months. Usually the CBP officer letting you inside the country on B2 / tourist visa looks whether someone has "immigration intent". If you are spending more time in USA than your home country in the last 12 months, they will most likely deny entry or cancel Visa.
You can do I-539 more than 2 times. But I am not sure how successful you will be. First time extension during COVID is fine. I would think the chance of 2nd extension will be rare.
Staying more than 1 year on B2 can cause future complications. She better stay in India for quite some time (1 or 2 years) before trying to enter USA again.
You might want to get legal opinion from some Law firm as you are playing with fire. These are extraordinary situations because of COVID. They might know whether people were allowed to do 2nd extension or some extraordinary clause in law.
Sorry. The law is very blunt. It treats 1 day violation and 179 day violation the same way. Beyond 180 days, one gets a 3 year bar.