I wanted to post an update and thank everyone for the much needed support and suggestions. Sorry its taken awhile but the days seem to melt away at a crazy speed these days.

I think one of the most thought provoking comments was this from HK:

"Now-- I mention that because I think that an expectation that, just 6 weeks into things, your family will have a good handle on managing your feelings and anxiety... sorry, but that probably isn't going to happen so quickly. For any of you"

At first read this seemed obviously true and I thought I was in full agreement and had no expectation of having a good handle on things.....but with further reflection I have to admit that my expectation on DD6 were/are perhaps unfair. We are now almost 3 months into this diagnosis and my own feelings and anxiety are not only still crazed but I don't expect to feel normal for a long time (probably ever). I am not sure why I expected my super sensitive 6 year old child (HG or not) to cope with this better than I can. Granted she does not know all of the awful things that I do about it but she is also 6 and knows enough to be fearful. I guess the truth is that I was (am) stressed to the absolute limit and frustrated that she was adding to our stress at a moment when I could not handle any more problems. I would not have blamed DD3 for flipping out on me but I was not being tolerant of DD6 flipping out since she was "supposed" to be the one person in our house least affected by this diagnosis. Yes, unfair. I am still not really sure what I could have done differently though in those first weeks. We talked alot about things when she was calm. I asked about her fears. She learned a little about diabetes and helps out with her sisters care at times. We did some one on one nice activities as well for some special bonding time. At the time none of it seemed to help. Thankfully she has greatly improved in the past month. I don't think it was anything we did or didn't do but who knows...perhaps I am less radiating less tension or something.

So thanks HK. I didn't know you were dealing with this nightmare also.

The other posts were very helpful as well. We have always struggled with time outs vs other forms of redirection. the problem is that she sometimes desperately needs a "reset" and once we get her to the point where she accepts this and spends a few minutes alone calming down (reading, drawing etc) then she often transforms back to my lovely happy girl. The problem is that it is nearly impossible to get her to the point that she accepts the time out. She won't go willingly to her room and she won't stay willingly in her room and she won't sit in a chair etc etc etc. Everything we have tried seems to escalate the situation until she finally gives in and then within a few minutes of calming activity she is fine again. We try other methods to get her to stop whatever bad thing she is doing but it just seems to feed the problem until she gets that reset. Avoiding the problem in the first place is definately a priority but I guess I too often miss the cues that a problem is coming or don't know how to head it off. I know we are also all a little sleep deprived too lately which does not help at all.

With regards to her more recent behavior which has improved but not resolved....it is a real struggle to make her feel that we care enough to take care of her if she is hurt but NOT reinforce the manipulation taking place. Generally that means ignoring it but then we have her crying that we don't love her which is both heart wrenching and aggravating and always leaves me wondering when she is really hurt and when she is just playing us. I agree with Emerald City that "a pinch may feel like a punch to her right now" and yet as Dude was pointing out, most of the time this is happening it is flagrant manipulation that occurs only after she has been told to go do something (go to room, do homework etc) or scolded for something (pinching sister etc). I am not sure that it is a calculated manipulation though as in an intentional ploy but perhaps more of a display of her complete failure to handle her emotions-which only makes me feel worse as I ignore the behavior since I dont really think she knows she is overreacting. ugh, now I am talking in circles.

At baseline she is a terribly clumsy child anyway. Her motor skills and coordination is below age level in my estimation and it is not unusual at all for her to bump into things or even just simply fall over while sitting in a chair, standing still or walking. She is also terribly fidgity which doesn't help. So, that being said, mild bumps are constantly taking place in her life and she is generally overreacting to them anyway. She often gets cuddles, ice and bandaids for these little bumps which are not intentional but that is different than the small or pretend injuries that occur while she is in trouble for something or when we are dealing with a semi-emergent situation with DD3 just because she wants attention.

Lastly, thanks also for the book suggestions. I have starting reading a book called something like Parenting the Manipulative Child--though I don't recall the exact name. It seems applicable so far but I have not gotten far enough to figure out what to do about the problem. I will check out some of the other suggestions as well.