AITA for believing my 2.5 yo over my MIL?

Without going into too many specifics, my MIL is difficult to deal with. The biggest problem I have with her is that she does what she wants with my daughter regardless of what me or my husband say. I’ll say no candy, she’ll give her two pieces. She sneaks her coke and tea even after we’ve told her not to. Most things are harmless enough but my husband and I watch our daughter like a hawk when we’re at their house now. We were there for a long weekend and honestly everything was going great. MIL was in a great mood and FIL was feeling good(he’s in his 90s and his health hasn’t been great the past year). I let my guard down and let my daughter spend some time with my MIL. A couple of days later when my daughter and I are eating lunch, she tells me MIL clipped her hair. I asked her where and she pulls at her bangs and sure enough they look like they’ve been cut. She also said the same thing to the neighbor when the neighbor said how blonde my daughter’s hair had gotten, “grandma clipped it” That would have been my daughter’s first haircut. I had no doubt MIL cut it. She mentioned a couple of times my daughter needed a haircut. Me and my husband said no we did not want to cut her hair. I texted my MIL that I knew she had cut her hair and basically we’d be going no contact for a while along with how I felt about the situation. She of course denied everything and called my husband screaming crying, “how can you believe anything a 2 yo says!?” So Reddit, AITA?

Edit to say it wasn’t a week later that I noticed her hair was cut. It was literally a day and a half later. I did notice it was different I just thought it was the way she had slept on it. Her hair is soft and fine so tangles aren’t really a problem and she hates it when I try to fix it so I pretty much leave it alone until it’s time to wash it, which I don’t do every night. Also my MIL has a history of disregarding your wishes as a parent. She is low to no contact with her step grandchildren for this exact reason.