I have friends sort of like this. They are paying for 2 "new" used cars and private preschool for dd who turns 5 in July but isn't being taught more than sitting still and being quiet and coloring in the lines. The mom works part-time, but instead of paying for daycare they depend on friends and family to watch their kids. My friend got a new iphone, decided it wasn't enough and got an ipad. They buy more convenience food than cooking from scratch.
The dad was homeschooled for 1/2 his schooling, but had a bad experience with it (not a lot of support groups back then) so he dosen't want to do that. According to him he wasn't exposed to germs enough as a kid, so he gets sick a lot now. He wants his kids to get exposed to a lot (and they get sick every other month or so) to build up their immune system.
You DIFFIDENTLY should be getting money from your sister, especially with gas prices being what they are. I think asking for 1/2 of what they were paying before would be fair. It's less for them, but good for you.