Thank all of you so much for your help! I showed these posts to DD7 so she could see how many people said that it is bullying, it is wrong, etc, and am now educating her about not attempting to "fix it". She likes to see things in writing, and the more opinions the better (I am an engineer and an attorney-think I rubbed off on her? haha)I am going to focus on her from now on, and let the rest of them worry about their own kids. We'll let the girls play together (supervised by Mr Baby Monitor!) and at the first sign of a problem, I will separate them. I promised DD7 that I would protect her from it, and apologized for letting it continue for 3-4 years. We are in a MUCH better place now.
I am SO GLAD that the pediatrician recommend the Davidson Gifted community. It's going to be a great resource for me!