A tragic irony has occurred to me. A long one, I'm sorry! 
It could have gone this way: Friend with DD says 'disaster, DH has double booked and is now away the same weekend as us. Would it be possible to bring DD along?'
You guys send the first email saying this really isn't going to work, totally unsuitable, change the whole tenor etc etc'
She thinks about it and then comes back and says ' You're right. Unfair on everyone to bring her along. Really gutted to have to do this but I am going to have to drop out' (Not a bad word about her arse of a DH because this type of selfishness is somewhat out of character and he has been working v hard and she loves him to bits)
Now I have picked up that you guys are a lot softer than you like to make out (yes, even you FF 
) and it seems to me not unlikely that after a day or two you would cave in agree that better she come with her DD than not at all and yes, for sure it's going to curtail some of her activities and you may have to split up some of the time, but hey life's a compromise....and then say to her 'yes if it's the only way out then bring her, though it may mean that you miss some of the fun (but not a word to our DCs)' She is so thrilled that you have accommodated her in this way that she bends over backwards to keep DD out of your hair and joins in whenever she can.
As it is, her stubborn-ness has polarised you all and caused acrimony as you say, and she not only gets to stay at home but possibly loses your closeness into the bargain.
I am still hoping that she may yet see this, that her DH similarly sees the light and that she comes along minus DD and the whole saga proves to be the making of the entire debauched weekend.