Girl, From one single mom to another...I dont know what happend between the two of yall, but for an adult with children to act so childish and immature in front of other children or to know how embarrasing it is to act like that in front of your childrens friends...she must feel betrayed by you in some way. My first reaction to your request of how to handle the situation was to go beat that woman's A**, but being that I know for a fact of how I've done some of my friends and if I had of calmly reacted and found out why we were all mad at each other instead of acting a fool (which I've done before). It was alot easier to talk to the friend and find out why there is a problem. It could be a simple thing just taken out of hand. Try to talk to her. Even if you have to send/mail her a letter. Trust me, I've lost friends that I really wish I still had. Dont burn bridges that you might later need to cross. I think that your friend must feel hurt by something or she wouldnt of acted so childishly. Remember that burning that bridge means its gone. It will take that much more in the future to rebuild it (the friendship) if later down the road you find out it was something dumb or simple that started the fight. Trust me. Find out why she has done these things, and tell her how shes hurt you and your children. Play on her sympathy first and tell her how you feel and that you dont know why. Try to stay nice in the note or phone call. Kill her with kindness as my best friend says. From experience, it will piss her off more if the friendship does end here, if you continue to be extreamly nice to her. I dont know how old your daughter is, but explain to her that its very important not to treat others the way they treat us. OR if the woman continues to act like she has, girl, you got every right to stomp her in the ground. I hope it works out, I cant tell you how many friends I've lost by not knowing the whole story behind our issues with each other and lost friends that I REALLY wish I still had.
Love ya girl, and take care.
J.
P.S. Let me know how it goes ok.