Apostrophe has it exactly right for the scenario where the parent with the DC who hurts others won't engage, or the parent attacks you after you've approached the situation in an adult-to-adult way as a friend. What else can you do but remove yourself and your DC?
OP, I think you should approach your friend about it gently if a pattern of behaviour had been setting in, as frankly, you have nothing left to lose now.
Keep it factual about your DC experience of being hurt etc. Leave aside any talk about 'you as a parent' and what you would do or your thoughts on 'her as a parent'. Just say that between you both as parents, it needs to be managed better because your kids are getting hurt.
Hopefully you'll get to a better mutual understanding and you can support each other and all will be well.
But if she won't engage with what you are saying, then definitely minimise contact for the sake of your kids.
Don't do what I did and put a grown up's delicate ego above your own DC's wellbeing. I wish I had said something to my ex-friend in a similar situation months earlier, but I didn't out of misguided loyalty to my 'friend' and fear of upsetting her.
My DC have definitely suffered as a result because of her DC behaviour and I feel awful about it now. I miss my friend a lot but with her ridiculous attitude of denial of what was going on, the friendship could not have survived anyway. I hope it works out much more positively for you, good luck.