Nothing quite like getting blindsided by a psycho zombie from hell.
If she still wants to attend family gatherings which this crazy person will also be attending, I'd say she needs to detach herself emotionally from the drama this person will try to create. This is not easy, but with practice, it can be done.
Humor often helps to defuse such situations: changing the subject ("Nice froth, Mary!"
, or making a piss-off-the-psycho game of it: "Say, I've heard that people who are obsessed with other people's sexuality are closeted gays, what do you think about that?" or making up bingo cards to show everybody how many times Mary said the word "socialist". A little public shaming isn't necessarily a bad thing.
But of course, some people will not be dissuaded from their insanity.
The cousin sounds utterly toxic. Unless your friend can find a way to maintain her own equilibrium at such gatherings, it might be wise for her to decline to appear.
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