A couple of days ago, [Unknown LJ tag] said that she'd never heard this, and that the major machzor today (ArtScroll) said "yom tov". We checked, and sure enough, she was right.
jonbaker did some research. And it turns out the only source for this form of the bracha was from the Alter Rebbe (the first Rebbe of Lubavitch). No one else has that custom. And so, neither should I or my mother-in-law. This may be a problem.
But the fact remains that I said some very foolish things about a person I know and I was wrong to do it. She had the right way and I did not.