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It really comes down to what type of person you are and how you feel about the situation.
You could always sue her and not have your insurance pay for anything (thats the point of having insurance in the first place). If your insurance does not pay for any damages, even if she calls them up and says whatever, you are still fine and your rates will not increase.
There is no reason why they should let her on the road again. Thats ridiculous if true.
You don't need to worry about her saying anything to anyone if she doesn't have insurance or doesn't even have a license! That deems it automatically her fault. I'm pretty sure even if you rear ended her, that would still be the case since she had no business being a driver in the first place. Just make sure that info is in the police report.
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