You are absolutely right to be honest with your daughter, not least because (as you’ve already said yourself) the consequences of not doing so are a complete breakdown in her trust in you when she finds out (which she undoubtedly will). Perhaps if your DP and his ex had emphasised the importance of honesty and the consequences of dishonesty to their DD at an earlier stage, she wouldn’t have stolen from your DD in the first place.
I assume you and/or your DP and DD had already asked his DD whether she knew where your DD’s missing presents were before he asked the girl’s mother to check her room. If so, your DP obviously suspected his DD of lying to you all as well as theft when he asked her mum to do this. Your DP needs to ensure his DD faces up to the consequences of doing both these things - the loss of trust is huge and cannot be overcome by pretending it didn’t happen.
Your DP needs to show his DD some tough love now to ensure she understands this and has to work hard to make amends and rebuild everyone’s trust in her (which is very hard to do and takes a long time). DP’s solution is to cover up his DD’s lying and theft by lying to your DD. This is not the response his own DD needs, let alone helpful to you and your DD.
Trying to understand why she did it and address these issues is admirable but, whatever the reason behind it might be, his DD also needs his help to understand why lying and stealing are unacceptable whatever her motivation was. If he doesn’t do this, the ‘why’ simply becomes an excuse to escape the consequences of her behaviour. How you and your DP deal with this will have a profound influence on his DD’s future - and your DD too.
Many years ago, I was teaching in an independent school and a group of adolescent lads got caught stealing from the school tuckshop. It transpired that this had been going on for a protracted period of time. It started when one or two of them realised if someone distracted the lovely (and very trusting) man who ran the tuck shop, it was easy for them to steal. These were all privileged children who had been brought up to know shoplifting is wrong and they certainly didn’t go without treats. However, the peer pressure to participate in the theft in order to be part of the ‘in-crowd’ was enormous.
The thing I found most telling was the way their parents reacted to being told their son was involved (the school had clear proof with CCTV footage). Some denied their son would ever do such a thing and made every excuse under the sun, even when shown the CCTV. Others, blamed the ringleaders for ‘forcing’ their son to get involved, while others blamed the school for ‘making it too easy for them to help themselves!’ One mother blamed her son’s father for walking out on the family, saying the damage this had done to her son’s mental health was the reason why he’d done this. Almost all of them wanted it swept under the carpet and didn’t want their sons to face any meaningful consequences. Some offered to pay the money back themselves, one even offered to pay considerably more than the cost of the goods, if the school agreed not to suspend their son. I know several of those boys went on to do similar (and worse) things.
However, the parents of one boy took a completely different approach - one I admire enormously - which had a very positive impact on their son. Whilst they acknowledged the effect the peer pressure had on him, they told him he needed to face up to the consequences of the choices he’d made and helped him work on becoming more resilient to any further peer pressure or temptation when faced with a clear moral choice. They asked the headteacher if they and their son could meet with the man who’d been running the tuck-shop to apologise in person (the school had suggested each boy write a letter of apology). Their son listened to the man explaining it was not really about the cost of the goods but how badly his faith in the boys he’d known, liked and trusted for many years had been shattered and the impact this had on him, not just in school but in his personal life too. At this point, the boy broke down and asked him what he could do to make amends and rebuild his trust.
You may not be surprised to learn this boy not only went on to repay every penny for the goods he’d stolen from his own weekly pocket money, he also volunteered to help the man with menial jobs one break time each week for long after the debt was paid. Not only that but he went without tuck for a term and his parents used the money they saved to buy the man a gift. This boy is now a truly lovely young man who went on to do exceptionally well in his career.
The benefits of restorative justice to the perpetrator as well as the victim are well documented and this cannot be achieved without helping someone face up to what they’ve done. With the right support from her father, at 14 years old, your SD should be capable of doing this and work to repair the damage she’s done to her relationships with you all.