There is nothing wrong with the good guy/bad guy method of personnel management. While I was on active duty I used it with my seconds in charge all the time. But we both operated from the same page.

And you both have to be on that same page. The good guy/bad guy thing is a strategy of co-management, not a contest between you.

If I might be so bold, sounds to me like you both might benefit from some serious compromise. She gets to be Good Guy but has to agree to stick to good solid practice ... that you both agree on. You get to be Bag Guy but have to give her the room to look after the employees.

Is that making any sense?