What a stupid, stupid teacher. Doesn't she know that she is supposed to teach, ie help children learn what mistakes they have made and help them do better with encouragement and by imparting information? And that, besides being obviously cruel and plain unacceptable, no amount of frightening humiliation can "improve standards" if the child doesn't understand what they've done wrong?
Oh I would be so furious - I would ask her if, since in your opinion she is so obviously mistaken about her methods, it's OK if you rip up all her paperwork in front of her colleagues.
Then I would a) go to the headteacher, b) contect ofsted and ask them about it, and present the school with their response.
I don't believe for a second that they've all agreed to it - she may just have said that because she's on the back foot and trying to wriggle out of it.
I have heard that angry parents are a problem for teachers - but hearing about this I can see why. God I am absolutely fuming on your behalf and your DD's. I went to primary in the 70s, before today's less violent and more understanding methods came in (generally speaking!) - but I never saw humiliation like this.
Feel the same about KTeePee's DD as well - how awful!