What a nut job, first is your dogs "viciously attack" her dog and the grandaughter wouldn't she have called the police or someone? If someones dog attacked one of my family members I'd be on the phone to report it and I love dogs. So I would think anyone who hates your dogs would be calling any body and every body she could. You know she has to be lying or else she would have done more then leave a note.

I say call her bluff, Leave her a very nice note saying how sorry you are that her dog and grandchild got attacked by "A" dog. Say how you do hope that the police finds out whos dogs attacked hers. But as for your dogs they have been locked up in your house all day and it impossable that it was your dogs. Even though it's a lie, tell her, If my dogs had gotton out the camera would have caught it. She doesn't need to know you don't already have a camera set up. Then get one. Thanks her for the "nice" note and inform her that you will be keeping it for furture reference, in case somethings come up with your dogs. Just make it sound like you are really concerned and care. This way the note can't come back on you, the way hers can.

This way, you look good as a neighbor, she might think twice about lying again about your dogs and with her thinking you have a camera set up, it will keep her away from your place, till you get one. Also letting her know you are keeping the note for furture reference might get her thinking about what shes done and that maybe it will come back to haunt her. I think sometime you have to fight fire with fire, just do it with a little class.

Just a thought off the top of my head, for what ever thats worth.

I'm sorry you have to go through this I know it's got to be ruff.