I feel your pain. It has to be SO hard to see it all unfolding. You did so well in not getting into it, not making a big deal out of it all. Not putting your kids in the middle.
I did not have to experience this. The OW crap was horrifying enough. My kids were older and chose not to be involved with her. 7 years later - it remains this way.
I guess the good part is that she is nice to your kids. That your D has a friend to do things with. Not much comfort, I'm sure but it is good to build on the positives.
Take care, I just wanted to let you know that I'm listening and understand,