Thanks for the replies.
Galagirl, I very much appreciate the advice. I guess I am unsure how to go about things with her. She is very much one to close down and retreat rather than having a conversation (of any type) where she feels uncomfortable. DH and I have been on the same page about what we want (although he is perfectly fine with things staying more of a "swing" type of relationship as well). BF says he wants things to be out there and open enough that we could spend time with the opposite member of each couple and everyone is ok with it.
At one point we did do "date" nights where the kids were with sitters and we went out separately on a date and stayed overnight with the other's spouse. We did this only twice before she said she wasn't comfortable with that. Since then we have gone on weekends (the four of us) and this past summer we went on vacation with them and all the kids. They really are like our family.
My personal feelings are that I think she has insecurities about herself. And BF has told me that she worries that he compares us and that she is afraid he may like some things better with me. I know we have had the "it's just different" conversation multiple times. So far the only thing she seems comfortable with is very light group "play" and the NSSSA(or not-so-secret-affair) as I've come to think of it.
We have already discontinued the group play and all it seems to have done is motivate her to seek attention from DH. He has tried talking to her directly (over drinks) and says she changes the subject when he suggests she talks to her husband about it.
I'm afraid to try to push her anymore at this time because I don't want to jeopardize the friendship either. As I said, DH and BF have been friends for 30 years and I've been friends with BF for 16.
Maybe I just need to vent for now and try to be patient. Thanks for listening.