Do you think this looks racist or discriminatory?

Hmm... if she's marrying a hispanic I don't think she meant that to be a racist remark. But it didn't sound very good either. Maybe she wanted to separate the ones who only spoke spanish to sit with other spanish speakers so they wouldn't feel uncomfortable at a table full of people who couldn't understand them. I would ask her what she meant by that, and let her know your concerns. I'm sure the last thing she wants to do is to cause tension or hurt feelings at her wedding.

Is it because one family is Hispanic and the other is white? In that case it's not racist, although the way she worded it was odd. What I'm wondering is, what if the Hispanic person has white friends? Does she still want them to sit with the other white people? In that case yes it seems racist. But I'm assuming your SIL just meant show the bride's guests where to sit and the groom's guests where to sit, and she figured that was the easiest way for your niece to understand.

The families for the bride and groom often sit on opposite sides. I'm sure she was trying to explain what she wanted in a way your niece would understand

You mean "carry her train", not "grab the dress tail".

Ask your sister-in-law or your brother what she meant by "separate the English and Spanish speakers". Perhaps she meant "escort people to their assigned table" or "help them find their name-card".

It's common to assign guests to specific tables (bride's friends at one table, groom's co-workers at another, etc). And it's courteous of the host/ess to consider the guests comfort level - you don't put a single person at a table full of couples, or a person who speaks only Spanish at a table full of only English speakers. But neither should they assume that this is West Side Story and that English and Spanish speakers can't mix together without chaos ensuing.

well its not uncommon for families to sit at opposite sides of a reception hall thats how they did it at my aunt and uncles wedding maybe your sister in law was just making it easier for your niece to tell them apart. Isnt it racist of you to assume she has alternator motives like that

I agree that isn't uncommon for families to sit on opposite sides, but as far as separating them by race, yes it is discrimination (but I guess it's her wedding so it's her decision)

yes, it looks racist. bride's fam on one side and groom's on the other. if this happens to be the same division as the one you are suggesting, then fine. however, i would not suggest that people are being divided by language, only by familial ties.