Frustrated
I have been married for 23 years, my step daughter and step son are both in their 40’s. I was never totally accepted. At different times I did get along with them. They both dislike their biological dad. I had a couple of heated arguments with my step daughter during the last year during the time my wife and their mom became extremely ill. My step daughter won’t let me see her children any more. My wife feels badly but I’m actually ok with it. Over the years of our marriage my wife raised both grandchildren everyday from birth to kindergarten. They basically lived with us. This went on for 7 years. When my stepdaughter got a dog we also became her kennel. There wasn’t anything I could do because my wife loved this arrangement. I became frustrated.
Toxic people don't like
Toxic people don't like having their own crap called on them. You did that. SD reacted as toxic people react.
You are fortunate to be rid of her. And though she may not realize it, so is your wife.
It sounds like you've more than done what your role required &
now it's time to enjoy your wife. Is she on board with you creating boundaries and disengaging from her adult "kids?" If not, you will have a battle on your hands. I hope you two are in alignment with your thinking and decisions.
If SD isn't coming around, she may've already assumed the "disengagement stance" which makes it very easy for you. All you have to do is come across to your wife as, "Honey, I'm respecting HER wishes, and to insist on inserting myself where I am not valued or wanted would only upset your daughter. Let's respect her boundaries, and that means we will no longer be able to keep her kids or her dog(s)."