It amuses her to see Elly setting exactly the same rules in her own home as she rebelled so vigorously against as a child. There is a special amusement in seeing her try to enforce them, especially with Michael, who is a mischievous male copy of his mother at the same age. At this point in life, with her own mortality beginning to make itself felt, Marian has come a considerable way over toward Jim's point of view. Childhood is a time for music and laughter, playfulness and fun.
Translated from gushy person into plain English, what is being said is that watching Elly do exactly the same things she did and seeing that the results are as completely ineffective and counterproductive with regards to Michael and Lizzie as they were with regards to Elly herself has finally made Marian see that her stupid screaming about how if Elly were not sat on, she'd become the same sort of petty tyrant her brutal ape father was had the revenge effect of taking what could have been a normal, happy child and turning her into the paranoid, doom-obsessed basket-case moaning about her weight, her lack of support and fighting a rear-guard action against chaos. Having realized that her attempts to save Elly made Elly into what she feared has given Marian a great deal to think about and leaves her with the hope that her child has the same realization.
This is not to be because when it comes time for Elly to watch Liz be the same sort of jerk-ass closed-minded petty tyrant, the boomer idiot will assume that tyrant parenting is the way of the world and the norm all aspire to because thinking that way is sure to please a mother whose only reason for not saying that she regretted the way she raised Elly is because she was told that it would cause her to die of confusion.