J.M.
Spend a lot of time with your friend and let the kids play too. It's a instinctive reaction with the whole discomfort for her i bet. Sometimes when people visit and my daughter is somewhat the same I feel a twinge of "Hey, I'm old hat!" But actually she's the one that the kid can go to in an emergency or for anything she needs. She's there for her always and the kid is totally aware of that. If she can find another great lady she loves then be the super cool aunt? The situations where it's reverse and my kid wigs at the site of a person(s) every time is even more uncomfortable I think. They are super straight forward and know what they like/dislike and have no problem expressing it. Being liked is pretty darn cool I say.