Who should host/pay for the Bridesmaid luncheon? when should it be? Does it have to be the day of the wedding?

You are correct that the "Bridesmaids Luncheon" is an event that the Bride and her family host as a thank you to the bridal party.

I would recommend that your daughter offer to host something else instead, so as not to take away from the Bride's family's plans for the wedding weekend. A small shower with the bridal party would be very nice if the family's events are not conflicting with it. Or, perhaps she can offer to take the bride to get her nails done prior to the wedding events starting and pay for it as her gift to the bride.

Remind her that the bride will be very busy prior to her wedding so her best bet is to offer her help and time. That's the true role of a Maid of Honor.

If they are not dripping in money I think it would be fine, tell them you want to do something like that but first want to check with them to make sure .*****( just is case they have allready paid for it ) Let it be there call, if not do something else and the day before is fine or the day of who says it has to be lunch how bout a late breakfast combo lunch.

The "Maid of Honor" usually hosts the "Bridal Shower" and is the right hand sidekick of the bride should she need any help. The "Maid of Honor" generally doesn't pay for the "Rehearsal Dinner" or "Bridal Luncheon" usually thats paid for by the grooms parents. However, if you wanted to pay for it, I'm sure they wouldn't have a problem since there are so many expenses they have probably incurred, it might aleviate alot of stress. Finally, be prepared because the "Rehearsal Dinners" / "Bridal Luncheons" can be quite costly.

Seems a little intense to add a luncheon into the mix of rehearsal dinner, wedding, etc. Why not just give each bridesmaid a lovely gift---a silver picture frame, a leather wallet, a beautiful scarf---and a handwritten note thanking them for everything?