A better question than "how do I confront her?" could be "Why does her cuddling him bother me so much?" If it's because you're looking for alone time, then start making some ACTUAL alone time with just you and your boyfriend. If it's just jealousy, then that's an issue you have to work on. To me, it just seems that you're not ready to see your boyfriend flirting/cuddling with another woman.
You say that emotions dominate in a relationship, but emotions just determine how you FEEL, not how you act. I personally believe that this is YOUR issue, not theirs, and that you need to take ownership of it if you ever want to move past it. Get both of them together and explain that you feel jealous when you see them flirting when you want alone time. Don't make it their fault though (since that'll just put them on the defensive) but let them know that you're struggling and need some help. But I do feel this is an issue that you need to work on yourself - over the long-term I don't think it's reasonable to expect your boyfriend and his other partner to NEVER flirt or cuddle in public if you're also there, ESPECIALLY if all your friends already know the score.