I'm also in the NE, and I can relate to your situation. My situation is this: My property backs up against a family who, on the surface, seem really nice. They have two kids, one, the DD, as old as my eldest DS (9). The awkwardness comes into play because my DS has intensive special needs. In the beginning, the mom (I'll call her Em) reached out a lot to include me in neighborhood parties, etc. I feel like maybe I put off a "weird" vibe, like you call it because I was hurting so badly, seeing all the kiddos my DS's age doing all the things my DS couldn't do. Occasionally I'd bring DS to these outings, and he doesn't do well AT ALL in large settings. Some of the other neighborhood moms, who are clique-y, like the woman you describe, were obviously uncomfortable with my DS's presence/behaviors. After that, the invites stopped coming. In the summer, it's particularly hard because Em has since put in a pool and has all the neighborhood kids over except mine. When I had DS#2, she came over with a gift. Now, with DS#3 I hear from mutual acquaintances that she's "dying" to meet him, but no call or anything like that. It's so awkward because when I'm out in my backyard with my kids, it's SO obvious that she's out there with hers and we can hear each other, but we don't say anything. Bizarre.
Anyway, not trying to make this about me, just want you to know I relate. If I were in your shoes, I wouldn't let the teen take the kids, just my opinion. I mean, if she really wants to see them, she can get off her butt and come to your house. She should be offering to help you, you've been through so much this past year. It doesn't matter if you feel you were weird or deserving of her rude treatment. She should let it go and come for a visit. I don't think I'd directly confront her only because I know how hard good babysitters are to come by. But I think I'd say to the teen next time she asks to take the kids "Oh, just tell your mom to come on over! It's been awhile since we've seen each other!" (With a smile, of course
) If she feels uncomfortable, she should get over it IMO.
Hang in there and let us know how it goes.
Hugs and sorry for your loss,