I am afraid you have to have a Plan B ready to go. I had a difficult situation to deal with recently (sorry, can't go into specifics) and I had to lay things out very clearly: the attitudes and behaviours that needed to change and the fact that I would not be an enabler and that I would do whatever was necessary to protect X. I emphasized the positives, but made it clear I was no longer prepared to accept the negatives. I specifically said I was making no threats and issuing no ultimatums but that I would do what was necessary. And I prayed like crazy. The thing is, I was fully prepared to follow through and do what was necessary, no matter how painful, because the status quo was quite simply unacceptable.
So you have to know what you are prepared to do to follow through. And act now. You do not want behaviours to become entrenched. I would suggest you put her immediately on a waiting list. After all, if things improve, you can always take her name off it again. You could also (although this would be a very expensive solution, so quite possibly not doable) build a small carriage house on your property for her to live in. Or find her a small apartment nearby. Does she have other children who could take her in? Explore all the possibilities, because it doesn't look hopeful that she is going to change her behaviour. And find one that could be implemented, if only temporarily, in the very near future. You would have to be the judges of how much she would know about your planning, but my gut instinct says, the more she knows the better. The shock of hearing her son making the phone calls might actually get through to her.
I am doubly sad about this, because I know how well you have gotten along with her before. A painful time for sure, but you can get through this. Stand firm, because so much is at stake.