It sounds like you're handling the situation extremely well, as is your daughter. It's so difficult to know when to step in and when to stay out of children's business.
My 6-year-old son had a little girl in his class last year who was a very, strong personality. She was the "ring leader" of all the little girls. She controlled everything, much like you're saying. My son came home many days with hurt feelings. He didn't understand why he couldn't be a part of their "girl's club", which the teacher quickly put a ban on. He wanted to play with them. He sat next to one of the little girls in class, who wouldn't really talk to him because of her ring leader. My son is a sweet boy without a malicious bone in his body (He's impulsive, but it's not in his nature to be mean.) He didn't tolerate her bossiness and nonsense when he didn't feel like putting up with it, much like you said your daughter stands up for herself. He'd go head-to-head with her and stand up for himself. Eventually, he just started to play with other kids. He didn't like that she was always hurting his feelings, but he was certainly drawn to her anyway. She had some sort of magnetic personality that he really had trouble staying away from. It seems most of the kids (especially the girls) had trouble staying away from her.
It seems like you're doing this from what you said (and it's always so hard when you feel your child is being hurt), but remember that the other child is just a little girl. And you certainly have no control over her, but you do have control with your child. Just continue pointing out what the child does to others, and how she makes your daughter feel. Your daughter will eventually have her "aha" moment about it. Or the other little girl will grow out of her bossiness and need for control. (I certainly remember those girls from when I was a child! Luckily, most of them turned out to be very nice girls.)
That said, have you spoken to her teachers about it? Not to complain about the child, but just for advice or help? They may have experience dealing with said child. They'll usually keep a watchful eye on things if you bring up your concerns. Most of the time, they see exactly what's going on.
I don't know if any of this helps, but I certainly know how you're feeling. Best of luck with the situation!
