Two things that stand out to me is
- you say " her (not even hers they are shared!) Toys when she got home."
Are you meaning that she specifically says that about toys that are shared, or are you meaning that you count all toys as shared?
The former, assuming you're talking about things like a trampoline/big outside toys is fine.
If you have a policy that all toys are shared, then I'd like to suggest that may be partially where the issue is.
I hated shared toys. Not because I hated to share, but because of the issues that went with it. I was the middle child, almost exactly in the middle between the two.
For example, Lego was regarded as a shared toy. That was fair enough, because basically if one of us got a Lego set, we made it once then it went into the main box. We didn't have that much-we never got large sets.
Whenever I went to play with the Lego, within minutes, one of my siblings would decide they wanted to play too. (I'm sure I did the same back too, but don't remember that, of course!) As it was shared we'd be told we couldn't say the others couldn't play-so there was never enough Lego once shared to make anything of any size.
So basically any shared toys never felt like mine.
I can imagine if that's the case, then that would increase rivalry between the two.
- but mainly from DD1, think DD2 has learnt it from her
It's very easy to blame the older. But do you tend to react as though the older is always to blame? Does the older one feel that dd2 can get away with anything because she's younger?
It's very easy to think the older should know better, and the younger will learn when they're older, so don't correct it. But I'd suspect your dd1 had to grow up very quickly with 2 younger siblings, especially with 1 with special needs, and maybe you expected far more from her at 5yo than you now do of dd2.
I'm not sure apologising is necessarily helpful at present. They'll each blame the other in their head for being so mean that they made them react like that. 
You need to get more to the bottom.
What it might be worthwhile doing is when you have them separately, having a chat. Ask them what they find irritating about the other. And listen. Yes, they may be totally unreasonable. Suggesting they give up breathing is unreasonable. But they may bring some insight into how you subconsciously treat them different.
For example:
Do you say to dd1: "Oh just remember dd2's only little, we'll just let her get away with it."?
Do you let dd1 have things "because she's old enough" even though dd2 is now older than dd1 was when she got it?
And when they tell you, don't dismiss it as "that doesn't matter" or say "oh I don't" or justify why you do.
They have trusted you enough to tell you, and they feel, rightly or wrongly, that is the case.
Sometimes it's really silly things that make children feel the less favoured one. I'll tell you one really silly one that my dm did. When me and younger sibling had different school holidays, if we were off and he wasn't, dm would often nip into the bread shop and buy him a cake "to make up for being at school." Fair enough. Yes, I'd agree, and I agreed as a child.
However if he was the one off, then dm would buy him the cake to eat on the way home. I suspect he wasn't meant to tell us, but always did, in that loving sibling way. 
That did make it unfair.
One time I plucked up my courage to say this when I was off, and dm dismissed it instantly with "I may have done once, but not normally."
I can tell you that this happened every time from once I'd started secondary until I left home.
I'm sure dm thought she was telling the truth, and I'm sure she didn't meant to do it, and probably thought it was a very little thing. But shop bought cakes were almost unheard of in our house, and it did disproportionally make me feel that I didn't matter.