Welcome to Yorkie-Mommyhood!!
Learn to say "No" ... "We don't let children hold her" ... "I don't let others hold her" .... "She cannot be off her leash" ... "If you want to sit on the ground, she will play with you ... do not restrain her"!! I'm sure there are lots of others that I learned to say! I made it clear to everyone we knew and our children & grandchildren, before we ever brought Toto home that there would be rules! Once everyone saw that I meant it, everything was fine and they saw that it was for Toto's own good.
Don't be afraid or too shy to set guidelines and if they aren't followed, simply remove Maddie. You aren't over-reacting, you're simply doing what's best for your baby!