I think your sister does need to forgive the person she thinks is her friend and tell her that she forgives her but that doesn’t mean she will have any respect or relationship with her. She needs to cut this woman out like the aggressive cancer she is. She is unstable and needs to go, no questions asked. I’ve dealt with people like this and they don’t change and they don’t improve. They will keep sucking away at the life of your sister and she needs to remove her completely and never look back even for a second. When I started cutting people out of my life that were like this, your life is a lot better off in the end. They do nothing but bring you down mentally and emotionally.
Thank you for the kind words. This is exactly what I told her. She would be transferring anyway.