My mother in law has been a big help with the baby - but she is always around - and insists that the baby be in her room at night - so that I can get some sleep. As a result I am getting no "alone time" with my baby. It is making me feel miserable...but she is so helpful - how do i say something without hurting her feelings.

Please talk to her and explain that you would like to spend sometime with the baby then she could help here and there in some other days

Try speaking to her. saying that you are worry that those sleepless night will take a toll on her health and body.

I am very envious of your situation haha. I wish I had more help and have some me time to get some rest.

Tell he that you care about her health and would want your baby to be with you so she could rest.

https://www.jw.org/en/publications/magazines/g201503/dealing-with-the-in-laws-problems/

thanks