How should I end a friendship?

I’ve been “friends” with my boyfriends best friends girlfriend. At first when we all hung out she seems really nice, but that was the only time I enjoyed being around her. Every time after that when they would invite us over for dinner, she would always be in a bad mood and I would feel awkward. I kept trying to give this friendship a chance but last night it was the same thing, she was in a bad mood. I also invited them over for my daughters birthday since my daughter and her daughter are friends... big mistake... she got mad at her boyfriend ( my boyfriends best friend) and was whisper yelling at him when I was right next to them. After she looks at me and says out loud “I’m not wrong. You agree with me right.” I felt so uncomfortable when she did that because I don’t like being put in that kind of position especially in my own home. I’ve also noticed that she has said somethings to me about herself that she has contradicted. For example, she said she doesn’t like arguing in public, but she did at my house and she was the one that started it... I’m at the point where I know I’m forcing myself into uncomfortable situations but I don’t know how to tell her nicely that this friendship isn’t going to work. I don’t want to sound rude when telling her but I also don’t want her to twist my words and ruin the friendship my boyfriend and his friend have.