This is also a dominance issue, I'd separate them when giving them treats if that is easily done, and if the Shi Tzu shows any attempt at fighting back, this could get worse with time, especially with the Papillion's hormones calling the shots right now.

You need to establish yourself as "the big dog," and not let her get away with the attacks at all. Don't yell, as that may exacerbate things, but be prepared at the first growl to remove her and refocus her on you, not her 'competition.'