It's just that she has said he is just a good friend and that she can't break all ties because she does not want to hurt him.
She is making her choice. What is YOUR choice? You cannot control what she says, does, thinks. You can only control YOU. Will you continue to engage with her in a friendly way? To pursue her? To go on dates with her? When she continues to make this choice?
Think about a boundary you want to set for yourself. Re-read the threads about BOUNDARIES (which are different than demands-- which you cannot make). Set some boundaries.
You are allowing her to hurt you. Have you addressed this in IC? There seems to be a major self-esteem issue going on here. How can you work on that?