who does the property belong to?

My wife and I have been married 7 years so far, and she told me we should make out our wills.
You see her mom recently passed away and my wife's brothers and sisters are fighting over the last house owned by her mother and father-who is also deceased. My wife's father never did a will or any other legal document assigning his property/properties to his wife or any one else. He ran his own business (now there is also the question: did he own the property his business was on), owned a ranch, a small apartment complex, and several houses.
After his passing My wife's mother gave one house to the oldest son, and the rest of the properties she gave, sold, or allowed the youngest son to do what he pleased with them (he ended up losing all of them except for one house-that my wife's mother refused to release to anyone).
This is the house everyone is fighting over now, also my wife's mother is supposedly on the youngest son's house as an owner (he is currently paying on a new home and his mother is on the paperwork as a owner)-so the siblings are looking to fight over this house as well.
With all this going on-my wife decided we needed to make out our wills-you see there are the obvious questions of who is entitled to what? We recently went to an attorney (in Houston, Tx.) to get some answers and advice-mostly to help one of her sisters- that her mom supposedly wanted her to stay with the last house.
While asking him questions over that situation-(which the answers didn't seem clear) you see supposedly her mom retained 50% ownership of the properties and the rest was supposedly split between the siblings, but on the other hand supposedly there is some law recently passed that gives the surviving spouse 100% ownership of all Properties; so which is it?-Anyway my wife told the attorney that she has 2 houses in her name, and to whom would they go to if she were to die? would they go to her siblings or to her husband? The attorney said to her siblings!! I didn't say anything at this point, because like I said we were there mainly to help her sister with her problem. Obviously this does not make sense to me, I have always heard that when 2 people marry all their belongings become community property-as I understand this-this means whatever is mine is hers now and whatever is hers is mine now; in other words all of our belongings (Financial, personal, real, etc...) are owned jointly by the both of us, Right?! And if one dies then everything goes to the surviving spouse, Right??
Anyway she didn't explain the details to the attorney (I don't know if this would have changed what he said) you see she was buying these 2 houses before we were married-of the 2-she payed one off before we married and one after. So obviously one house was payed off using my money as well as hers-also all the maintenance to these 2 houses and years of taxes have been paid with my money as well-not just hers; in fact if it were not for getting married, I truly believe she would have lost both houses a long time ago (when we met she was hurting financially)-and as I said before it's not her money, it's not my money- it's our money, just like it's our cars, our houses,etc... Right?? This is what I need to know- was this attorney right or wrong?? Do they go to me the husband or to her siblings if she were to die with no will made out??
You see the attorney at no time mentioned my father-in-laws' brothers
and sister's having any rights to this last house or any of the other properties my mother-in-law gave away, etc... to her to son's (and none to the daughters)-Do you understand what i'm saying- if this attorney is telling us that if my wife dies with no will, the houses go to her siblings-then why didn't he say the same thing about my mother-in-laws last house (in that case the same would apply-her husbands brothers and sisters would have claim to all their properties too-right???
Please help clarify this for me-also a couple of years ago-my wife out of anger said she would leave her life insurance policies to her sisters (as beneficiaries) and I wouldn't know. Is this possible can you leave your insurance benefits, cars, other property, to someone other than your spouse in the event of death? I've never heard of this!?!

By law a certain percentage has to go to the spouse...a local lawyer wil help you determine the share...