You may have to step back and reexamine what all this is doing for you.
Yes that is your sister and you want to be there for her. BUT you do NOT have to take any abuse of any kind. Not even from a family member. I often say that family can often be worse than friends. Sometimes family members know that they can pull any stunt they want and others will be tolerant because "it's family". I had to step back from my sister and mother because of the stunts they would pull (long, long story). Their issues would leave me feeling awful and I allowed it. Not anymore. They still try to pull little things here and there but they know I'm not going to deal with it. I have my own life, my husband, and my career. I'm not going to let them ruin what I worked so damn hard for.
For your health and sanity, try to keep knitting and just slowly step out of her "craziness". Offer outside resources for help, but don't get caught up in it. She's a big girl. She can take care of her self.
I hope that all will eventually improve for you.