Being the bigger person, where’s the line?

Recently we’ve discussed our MIL issues with some of our friends, who don’t personally know her but they are very smart with great communicating skills (also part of their jobs), so we got some nice practical tips how to respond in specific situations, what to focus on during arguments etc. It was a very nice and constructive conversation. Eventually we started discussing “how to be the bigger person” and that’s something that got stuck in my head and I decided to discuss it also with you guys as you can be very helpful.

They basically implied that being a bigger person is to understand that behind my MIL’s disrespectful, entitled and selfish behaviour is a lot of love and she’s most likely behaving like this because she just wants to be close to us and she’s just not capable of behaving “normally” because she’s insecure and hurt and that’s something we should consider and be more understanding, hence be the bigger person.

On one hand I get what they were trying to say, theoretically, on the other hand it just kinda doesn’t feel right to me? Even if I could see where some of my MIL’s behaviour is coming from, I just don’t feel like it would practically help me in any way. I really can’t ignore and accept her behaviour towards us just because there are psychological reasons and explanations she behaves like she does. There’s always a reason for everything, right?

What am I missing? Am I just not capable of being the bigger person? Where’s the line?