Parenting...WOW

How do you instill enough confidence in your children to help them be successful?

I'm getting concerned about my Princess and would love any suggestions or advice you may have.  She has a friend who can be very sweet, giving, and nice.  However this friend can also be extremely manipulative and downright mean and rude.  I keep encouraging Princess to stand up for herself by either telling this friend to "stop" or walk away and not play with her anymore when she is on one of her mean kicks.  But so often I hear Princess pleading for forgiveness from this friend for something she didn't do (ie-I'm so sorry!  Don't stop being my friend.  Or please still invite me to your birthday."  If I tell them it's time to come in, Princess will ask her friend if it's okay that I said to come in - to which her friend will reply, "that's not very fair or nice to me!"  It drives me CRAZY that my daughter is cowering to this girl just to be her friend, and if I say no more playing with so-and-so, it just comes off as punishment to Princess.  What else can I do to help her understand that she cannot stand to be treated this way?  I worry about her tendency to follow someone else and not stick up for herself just to keep being friends.

Yesterday I overheard said friend speaking VERY rudely to Princess and getting in her face and yelling about something.  I went over to see what was going on and this friend was upset about some secret she said her cousin and Princess had and Princess wouldn't tell her the secret.  I asked P and she said she had no idea what her friend was talking about.  Friend kept insisting that a few days ago she knew that her cousin had told P a secret. ????  I explained that I was sorry she felt upset, but Princess didn't know what she was talking about and if she really wanted to know she should ask her cousin if he remembered what it was.  Then I continued and told her that she may not EVER speak to my daughter that way - I wouldn't let P do it to her, and she cannot do it to Princess.  Friend argued about it saying she just wanted to know the secret, to which I again said, "Friend, Princess doesn't know the secret - if you want to ask Cousin fine.  But DO NOT talk to my daughter like that again.  Do you understand?"  I then told Princess in front of her friend that if Friend wanted to be mean again, P should walk away from her.  I thought it may have helped to stand up in front of her, but again today Princess was bending over backwards.  *sigh*  It's not as simple as just saying, "You can't play with Friend again" due to the fact we are neighbors and friends with the other family members.  By the way, in defense of Friend's parents - they are very good people and not uncaring about how she behaves.

I've heard kids in karate build up their confidence and self esteem...

Besides wanting to help the confidence side of Princess, it is also coming out at home quite a bit.  She is lashing out at me and is really becoming this super angry child who screams and throws things at me and talks back like a teenager.  In fact it was SO bad the other morning that I even asked her if she treated and talked to her dad like she did her mom what he would do.  Her reply?  He definitely wouldn't like it and would probably throw her into a wall.  (He really wouldn't hurt her like that, but he's been known to give a solid smack on the buttocks when it's called for).  I don't want to spank her - it doesn't help the situation.  I can't just ignore it because truly, it's unacceptable and there is obviously SOMETHING going on.  I just don't know how to help her deal.  I keep wondering if I should take her into counseling to try and figure out what is going on.  I just really would like that to be a last resort due to $$.

Parenting...WOW.