Deb, you are a saint for raising the 2 gc who need you and, no, you don't have to buy your other gc all the same things you buy them. Yes, be equal about Xmas and birthday presents but that's all. Jealous dd and the other gc need to understand that it's as if the ones who live with you are your kids. You don't have to do for others everything you do for them.
It definitely sounds as if the 9 has emotional problems and maybe so does her mom. The baby will develop them, too, if she's exposed to too much of this horrible behavior. They need counseling, but that's up to their mom.
Agree with grannypiper's "rules," etc. Jealouse dd might cut you out, for a while, but maybe you and the grands you're raising would be better off. You can't do much to help the 9 or the 2, but you can help and protect the gc you're raising. In fact, it's really your job to do that, imo. So if setting new rules and perhaps even pushing the jealous ones away a little bit will make things better for the ones you're raising, then that may be a good thing. It may sound harsh, but it may be true.
About the ballet class, can you enroll the 10 in another one? And this time don't let the other cousins know about it?