Regardless of the mother's role (if any) in the situation, the bottom line is that at 96 she is unlikely to have a lot of time ahead of her, and if she wants to see her daughter, there is not the luxury of waiting to see if things change, or rifts are healed.
Yes, the house belongs to one daughter, but it is the mother's home, and even prisoners are allowed to have visitors.
As others have said, the 'rights' and 'wrongs' of what happened are irrelevant, and possibly lost in the mists of time anyway. It really doesn't matter if the house-owning sister is 100% blameless and the other one is rotten to the core - she does not have the right to issue punishments and prevent a mother and daughter from saying goodbyes just because she holds all the cards in this situation.
In many ways, it would be better all round if there could be some sort of truce, or even a temporary ceasefire, so that the funeral (when it happens) can go ahead with a veneer of family solidarity. There will, presumably, be others there who want to see off the old lady, and it would be a shame if their last memories of her were spoiled by all of this.