Is it permissible to prevent a wife from visiting her harmful and envious family, and is it permissible to instigate quarrels to cut ties with them in order to ward off their harm?

The evil eye is real, and envy is a proven fact. Protection from them is achieved by relying on Allah and persistently engaging in His remembrance, especially the invocations that ward off the evil eye and its harms, such as Ayat al-Kursi and the two Mu'awwidhatayn (Surahs Al-Falaq and An-Nas). You should not sever ties with your wife's family or order her to do so, because it is incumbent upon you to help your wife in honoring her parents and maintaining kinship ties. Kindness to in-laws is enjoined in Islamic law. To help you deal with them: try to mend relations with them and invite them to Allah. Limit your relationship with them to the extent that fulfills kindness and kinship while preventing their harm. Do not show them what blessings Allah has bestowed upon you, and be diligent in protecting yourselves with legal ruqyah (definition) and by saying, "What Allah wills! There is no power except with Allah."