"No she didn't want me out of the picture she just wanted time alone with him. And the strange thing is I did let her have time with him but it was never enough in her eyes."
Ah, so the conflict had to do with how *much*
time was appropriate for her to have alone with the husband.
There probably wasn't any middle ground you could have all agreed on, and of course her not respecting you is a serious roadblock.
Maybe it's possible to build a new friendship based on mutual trust and respect? I hope so.