Am a long time Mnetter, have written about some of the events leading up to this under other names.
Potted history... got a friend who has always been very self-centered in most respects (although very generous with gifts/drinks etc cos her DH is loaded -in some ways, she buys friendship/loyalty) Her DCs are hot-housed beyond the most hot-housed kids. If her DCs fall short of perfection, it's not their fault but always someone elses. TO which end, she bad mouths anyone and everyone rather than get her DCs to face up to reality. And her DCs are starting to suffer because they can never be the perfect people she wants them to be.
I've taken it with a pinch of salt for years, but when it comes to slagging off other children, professionals, and now seeing the effect on her kids, who I love like my own, I had to say something to her. I stated facts, which she refutes. In short, she is delusional and I am seriously worried about the impact that will have on her DCs. Not to mention the professionals she has called into question.
I appreciate that you have only got my side of the story here, but please believe me, I have already said goodbye to this friendship, am more worried about her DCs and not sure what to do.