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Thank you all for your very sympathetic and encouraging comments. My mother-in-law did come down this morning ( she lives only five minutes away) and I treated her exactly the same as I have been doing for years and waited for her to bring up the subject. We then discussed it as a family in a very matter of fact way without emotion. It worked and I think she really appreciated that we were talking to her normally and not as if she had grown two heads! I've read so much about people being shunned by their friends once the news is out that they have cancer and we're determined not to do this to her.
Sqad, I'm immensely grateful to you for your advice and I've Googled Cuthbert Dukes. My mother-in-law was shell-shocked when the consultant told her the bad news and my wife who was with her at the time, felt unable to ask the consultant about the severity of the cancer, survival rates and other key questions in front of my mother-in-law. You've answered one of those questions and we've got some idea of where we stand now. Thank you.
Thank you all for your good wishes - God knows, if I've ever needed some inspiration and optimism from friends, I need it now.