I think the first step in being a good mother-in-law is get to know your daughter-in-law. Spend time with her. If she is open to it, have a Bible study with her. Get to know her family. Pay attention and figure out her love language. If you aren't familiar with them, read the book 'The Five Love Languages' by Gary Chapman. It helps to explain where many communication breakdowns come from. A person thinks they are communicating love to someone else, but the person doesn't hear it or feel it because it wasn't in their language. Make the effort to learn about her hobbies, interests, and job. Encourage her in those pursuits.
Give her time to get to know you and trust you. Be careful what you say to her. Avoid even the suggestion of a criticism, unless you have developed a deep and open relationship. Even then be very cautious. Don't talk about how wonderful and talented your daughters are. It will make her feel criticized and inadequate. Let her hear you praise and appreciate her to other people and say it directly to her. Let her know you are one of her biggest fans. Keep the lines of communication open. Pick the way she feels most comfortable, whether phone, written notes, electronic, or in person.
When the couple is starting off, give them time and space to develop their own family culture. Give them freedom to make their own decisions without your input. Don't make your d-i-l feel as if she must compete with you for your son's affection and appreciation. Don't interfere or be a busybody. They will make decisions that you disagree with. That's OK. Just because someone chooses differently doesn't mean they are wrong. There is more than one right way to do something. Support them in whatever they decide. Feel free to pray for them all you want! That will avail more than all the interference or comments you make will do.
When your daughter-in-law does something that hurts your feelings, forgive her. Allow her to grow and mature without criticism. None of us wants to be remembered as we were. We all did things we would rather not have remembered when we were young and first married. Be positive. Express your appreciation and notice of the growth and maturation in her life. Tell her whenever you see her doing the things you appreciate (Loving your son and grandchildren, helping others, etc). Help her feel welcomed into your life. If she offers to help with something, accept it warmly. Don't be demanding. Invite her along when you do something with your other daughters. Find something special that the two of you can enjoy doing together.
Support their marriage. Offer to watch the children periodically so they (your son and his wife) can go out on a date night together. If finances are tight for them, and you can manage, help them to have some time away as a family on vacation. Be supportive of whatever educational or other decisions they make as a family. Resist the temptation to give your input unless asked. Be careful what you say to or ask the grandchildren. It will probably be repeated at home. Don't probe or criticize. Treat your d-i-l as you would have like to be treated by your own mother-in-law. Never stop praying for their family.
I would love your input on what I have missed. What was the best thing your mother-in-law did for you?