I would put aside the various emotional issues at play here as a starting place. It's certainly not that I think they're unimportant, but I think they may be obscuring the more important issue: How much can you legitimately and reasonably afford to give her to help with the wedding? I think that's the best number to go with. If that's $500, then give $500.

But here's my feeling about the emotional stuff: I try to only give gifts if I can give them freely--without reference to any emotional baggage, guilt, hard feelings, etc. If I can't give them freely, I don't give them at all. If you really are at a place where you can't give your SD a gift, then don't give her anything. I think that's a legitimate and fair approach if that's where you are emotionally. But be sure you're really there before making that call.

Good luck.