This thread, honestly!
OP, if you were only really looking for advice on how to extract your family from this arrangement, you could have framed the question in such a way that you did not need to go into the ins and outs of your friend's parenting and inadvertently invite lots of really unhelpful comments from posters who have very little idea of what your friend's parenting is actually like.
I read your OP and wondered instantly how much of your friend's explanation was
a) your interpretation of what your friend actually offered by way of explanation ("We are trying to implement a low demand strategy for x, y and z reason" is heard as "We can't say no to her")
b) you paraphrasing a more nuanced explanation of your friend's parenting strategies
c) your friend giving you a shorthand, perhaps a bit flippant, version of their approach 'between friends', thinking you'd 'get it' as a parent of an autistic child?
It's entirely possible that your friend's DD really is much better regulated at home because they have put in place the necessary accommodations, adjustments and boundaries where appropriate. Maybe they genuinely believed that a holiday, inherently low in demands, might be OK, while possibly underestimating how much the new environment and new faces would impact her. Some dysregulation and meltdowns may be unavoidable, as her older siblings can attest to, as we cannot account for every eventuality. This is especially relevant in school, as, with the best will and strategies in the world, there are so many variables, especially in a mainstream primary, that simply cannot be controlled for.
PDA is a pervasive neurodevelopmental condition which can present in a variety of ways and change over time as a child grows. A PP suggested viewing your friend's behaviour as a panic attack: they're spot on. Others have suggested that the inability to regulate effectively is similar to that of a much younger child, with the added implications that cognitively, it is much harder to learn from experience and embed this learning in a way that informs subsequent behaviour. Many children and young people internalise the anxiety they feel around demands through self-harm ‐this can include the experience of demands which are self-imposed, such as looking forward to doing something they know they enjoy. The perceived demand to enjoy something is simply too much and causes acute anxiety. Hence, experts do often advice low demand strategies in order to maintain regulation, and advise that cognitive nudges take place during times of low anxiety and secure regulation. Low demand isn't 'no demand', but there are many strategies of lowering demand while maintaining boundaries which may, to someone who hasn't had to tread this path, appear to be simply throwing in the towel and letting the cards fall where they may. But it almost certainly isn't.
Your friend is probably exhausted, burnt-out and by now used to judgement and parent shaming from all sides: school, her own family and her own social circle. Poor woman.