How should I treat this self-centered friend?

Right now I have a close (girl) friend in my campus, let's say her name is X. Probably because we are schoolin in political course and have realism as our way of thinking, we somehow become close and enjoy chat with each other about anything.

The problem begins when lately, all friends of mine begin to tell me if X is being bossy, arrogant, and backstabber to other people. At first I think they are wrong, because if though she's basically evil (we are often mocking each other) she is not a backstabber. All my friends begin to exile her from community and as far as I concern, I, with several friends on campus are the only friends she hangs around.

And well, today we had some dispute about group assignment. Primarily, we are intended to form a small group, consist only four person. The quarrel begins when two friends of mine send me a message to join our group, after I replied if I didnt mind to,

But X told me if she didnt want too much members in group, because it wouldnt be effective, the lecturer also said to limit members into five. Afterward, she gave ultimatum to me, if there are two additional members
added in group, she will be the one to separate.

Her words felt like a declaration of war. I feel this is probably the time to end this friendship. I begin to think if what my other friends said actually true after all. She's too bossy, snobby and arrogant, and she doesnt think anybody else but her.

Well, if you were in my position, what would you do? Will you keep befriended with her, or slowly, step away before she backstabs you in the future? Even though our relationship is profiting each other, I couldnt stand her personality. She's too much self-centered these days.

Realist said if there are no permanent friends, only permanent interest. Perhaps it's true after all?

Jam it back in, in the dark.

Thanks for the tips guys. I've been thinking a lot about this, and well... I guess I gotta expect nothing more from our friendship at the moment. I think the best way to out from this situation is to keep distance from her slowly, so she wont percept me as another enemy.

But well, deep inside I still hope we could stay as good friend...

There's nowhere I can't reach.