I'd like to offer a different possibility, as a SM who has been accused of similar things.
My OH has been uncomfortable for years with the way one of his kids treats him like the bank of england and mismanages their money. Long before he met me. He has tried to get them to change their behaviour, to no avail. I come along and offer an objective view, and support. My interests are to support my partner and with that comes support for his kids. He has been getting stricter on the money front and getting this kid to wait until he can afford things before he spends all his money on stuff he wants. At times this has been uncomfortable for the son, but he has got a part-time job and is behaving more responsibly, and has thanked his Dad for pulling in the reigns. He could point to me and say "nasty SM, you're changing the way my Dad behaves towards me and making my life more difficult", and he would be right in a way and in the very short term, but he has not. He has thanked us both and has even followed some tips I gave him about saving, putting it into action, and all is good.
Another son's behaviour has been goddam awful to both of us and his siblings. He has been rude and his Dad has told him off, as he's always done, nothing to do with me. He excelled himself in his rudeness recently and spoke to his Dad and me in a way that left us reeling. We have heard he has said some further awful things about us to various people in our circle, conveniently missing out mentioning his actions and also making up things about us and pretending they are true. Where are we now? I want this son to apologise to both of us, something he has failed to do for two months. I want this son to stop continuing to hurt his Dad and stop lying about us. I want this not because I am a nasty SM from hell, not because I am a selfish SM, but because I want the best for those around me. He has chosen to create a story around his Dad and I which makes him look like some persecuted son losing out to a nasty SM. I promise you when I say with complete honesty, he could not be further from the truth, and how devastated I am at hearing the stories and lies he has been spreading to make his own position look faultless and a victim.
I would find it very difficult if not impossible to be friendly with this son until he apologises. The damage he does to everyone, including himself, by his behaviour is so great that it has to stop.
What I would say to you OP, is that I read your post and wonder what it is like from the SM's position, and I'd like to hear her side before I would make any judgment.
What I would also say, is if you want the family closeness so much, why don't you contact the SM directly and ask for a talk. If apologising is too much to think about right now, that's fine, but open up the lines of communication. Extend a hand. See where the conversation goes. You might see that she is where I am standing, and you might feel like an apology is needed, and you feel good giving it, and that's fine. You might see that she's a bitter selfish woman who has some agenda that does not include you and most certainly feel you don't wish to apologise at all, but you know you have tried. And that's fine too.
Just reach out, for everyone's sake.