Do you think this is that innerpropriate?

I understand both of your points, but if she is concerned about what her 3 year old is listening to and imitating it is up to you to monitor what music she is around. There is nothing you can do about what she is already singing, but you can help control what she hears in the future. It's just like kids picking up on cuss words people use around them, they don't know what they mean, but we still don't want them to use them. So I would just tell your sister that you will try to monitor what she listens to from now on and leave it at that, if she has a problem with it, then she needs to find someone new to watch her. It doesn't sound like anything you have done is that bad. Good luck!