Is it permissible for me to stop trying to reconcile with my wife's sister's husband, and simply treat him in kind, after my repeated attempts to end the dispute were rejected by him?

It is better to be patient with the abuse and harshness of this man and to respond with kindness and overlooking, as this is one of the greatest acts of obedience and nearness to Allah; Allah Almighty says: "So whoever pardons and makes reconciliation - his reward is due from Allah," and "Repel [evil] with that which is better." The Hadith states: "Join ties with those who sever them, give to those who deprive you, and forgive those who oppress you." However, if you are harmed and distressed by his actions, there is no sin in limiting your relationship with him to what repels harm from you, even if it is just to exchange greetings of peace. Al-Hafiz Ibn Hajar said: "Most scholars said: 'Boycotting (hijra) ceases merely by exchanging greetings of peace.'"