I think the people that you have to 'deal with' are people that you don't need to be around.
It isn't you with the main problem, it is her-your problem is dealing with She That Has A Problem, iyswim.
You are the Chairman of the Board regarding anything about your children. Don't let the problem one oust you from that position. Find a simple statement, memorize it, rehearse it, say it 10,000 times so it will pop out of your mouth just from muscle memory. Something like:
"I don't observe that policy with my child, she is allowed to decide this for herself." Note that this is not a statement directed at the problem one (as in "will you stop it!!), it is a statement of fact of your policy.
Then if the response is something rediculing or disrespectful, otherwise degrading then speak with your feet (suddenly remember superfical reason) and leave.
I think you should go ahead and establish such boundaries with this person. I predict your relationship will end-and I would feel that that would be ok. (What are you losing?-someone who craps on you and on your child very often. Relief.)
Others will begin to respect you more, and I doubt that you are the only one that feels this way about her. You will respect yourself more too, your d will respect you more too.
There doesn't have to be a big showdown, ok?-stay in adult mode. Just start, one circumstance at a time. Some can be predictible-so choose one and give it some thought.
Good luck. Hope this helps some.