In my opinion it is unwise to let children have unsupervised access to anyone who may coerce them or be a negative influence. By letting her have unsupervised access you would have no control over what she says to them. In addition you are saying to the children that it is ok for your parents to treat their children badly and you are happy to enable them to shun you.
I would say to her that she is welcome to come to your home any time and visit the children, but if she comes she is not permitted to talk about you and your wife in a negative way and she must be polite. You and your children are a package deal because you are a family.