"I think it's particularly worrying that your son's girlfriend was bold enough to tell you why she has a problem with you to your face and in front of her parents. This suggests that she actually believes she is totally reasonable. There is no telling what someone this deluded might do."
Unfortunately, if the girlfriend does have a personality disorder - she'll be well-versed in rewriting history to suit her own ends/needs. So it may not be that she believes she's being reasonable... but more that she actually believes it to be the absolute truth.
My daughter has a diagnosis of NPD with traits of EUPD. When she's medicated she can be the loveliest person in the world - but when she's decided there's nothing wrong with her, I'm "out to get her", I colluded with the psychologist and doctors who diagnosed and prescribed anti-psychotic medication for her because I "didn't like" or "hated" her
and she stops taking her meds? She's dangerous. Goes from 0-90 in the blink of an eye.
Unfortunately, OP, I see a lot of my daughter's behaviour in your son's girlfriend. If her parents are doing nothing, or very little, to get their child help - or simply to help you bring about an end to this "relationship" (although it seems more like a hostage situation, with your son suffering from Stockholm Syndrome!) - then I would elevate the situation. Keep reporting her to the police. Talk to the school and get them on side. Involve (or simply threaten to) Social Services. She is guilty of incitement to murder, for crying out loud - why aren't the police taking it seriously?!
Eventually either her parents will see sense - or simply do something to get her help, if only to get you (the police/social services/the school) off their backs. But they may simply be bewildered by the sudden change in their child - as another poster with a child suffering from BPD (and believe me, it is an illness), they literally change overnight. I was begging our GP for help to "fix" my daughter from the time she was 13 years old (she's 24 now) - and they did nothing. It took the police pushing for a mental health assessment of her, when she lied to them about me being abusive in order to have me arrested (I was, but never charged thank goodness) and her younger brother (of whom she becomes extremely jealous at times) put into care (he wasn't), for her to get the help that she needed. Nothing I, as her parent, said or did helped. Perhaps her parents are in a similar bind.
Unfortunately, the more you tell your son to end it etc., at 16 he's not likely to. You could end up simply pushing him further into her arms. Just let him know that you're there if he needs you, that you love him, that you have his back no matter what. Keep a weather eye. But don't nag. You don't want to push it into crisis mode, whatever else happens because if that happens? You may well lose him to her, or the judicial system, permanently.
Good luck.