I'm new to childminding so don't have as much experience as others here but thought I would answer your post.
** CM overly (IMO) clingy/affectionate, always insisting on a kiss before leaving, and always doing it full on the lips.
I don't know if you would find me too clingy (I hope not!) but I do say to all the children (or sometimes the parents say it)give me a kiss and a cuddle bye bye. Sometimes I get a kiss on the lips normally because the child put it there, but when I kiss them I kiss on the cheek or head - mainly due to germs!
**Continuing to hold onto DC even once I've arrived to pick up
That's a bit odd but could be innocent; I generally hold the children (if not walking) while I chat to the parents unless it's clear the child wants to go down/to parent. That's because as soon as you hand the child over they want all the attention on them as they haven't seen their parents all day and the handover doesn't get done properly.
** and continuing to act like the one in charge
In my house I am the one in charge when parents are here. I find this time can be tricky and is often when a child 'play up' as they want to see who is in charge. I like to think I work with parents through rather than coming across as commanding.
** Talking out loud, in public, about DC putting hands down top and touching breasts
That's a bit odd, but if it was anything weird wouldn't she be keeping it quiet? Some people just have no, I'm not sure what the word is, but social awareness of when to stop wittering on?
**Telling me (more than once) about how DC puts head between breasts and bounces it around saying 'boobies'
Again a bit odd, but maybe she is worried that the child is saying boobies a lot and doesn't want you to think she has been encouraging anything odd? Like, "it's all her doing this bobbies habit, not mine!" IYSWIM?
**Talking about how DC is good at xyz because of CM's actions, rather than mine
Obviously I'm not you, but if I put myself in your position with you worries about everything then I would start to feel defensive. What is she actually saying to make you think she feels like this?
**Blowing on bottom for a good while to help nappy rash
Personally I wouldn't do this, mainly because I don't want pee or poo in my eye! What does a good while mean?
**Hanging around for far too long after dropping off, albeit talking about DC and the day they've had
I chat to my parents for ages mainly because I don't want them to feel like I'm rushing them in and out. How is she with other parents?
The red lips cold be from nappy rash? And I don't know what you mean about the sleep/saying no no no.
To me it feels like something else has triggered these thoughts? But these little things have 'backed up' this bigger trigger / made you more sort of hyper aware of something.
If you're gut instinct is telling you something is off then you absolutely should withdraw your child and you should report it. If there is nothing going on then she has nothing to worry about. If someone reported me for this sort of thing I would like to think I wouldn't bat an eyelid, if people don't report then the system is useless isn't it and vulnerable children go unprotected.