That is a very bad situation. (The fact that one of my pet peeves is 'outdoor cats' doesn't help either.) I don't know what to tell you--I have the same problem w/ my inlaws, only worse--Pitbulls.
In short, they have a male and female and for them that was all that was needed to breed the two--and you can CLEARLY tell that
all else aside, looks alone, these are not two dogs that should be bred, period. The female whelps where and whenever. I *think* they have only bred them once, but once is too many! They keep the dogs chained up...they do have dog houses, but they pretty much have no grass, only mud. You can see flies buzzing around them all the time. They get fed whatever table scraps were left. It's really sad.
Luckily (if you want to look at it that way) there are LOTS of things my inlaws do that neither hubby or I agree with and we rarely go to their house (I think the last time was Christmas), so I don't have to see it much. I'm just dreading for the day when one of them escapes and hurts someone. I know it's coming. (Another reason why I and MY CHILD don't frequent their abode.)
I thought about reporting them, but to who? Their neighbor has had animal control called on him several times for complaints about his dogs (which my BIL tells me he fights and sells for fighting
) and there have been authorities to their house before, so the officials who could do something about it are
well aware of the situation already.
So in a nutshell, I completely sympathize with your situation. Darned if you do, darned if you don't. I would flat out refuse to visit them. Explain to hubby how strongly you feel about the situation and that avoiding the option you choose instead of reporting them.