Your board, your rules- I respect you so I'll certainly make an effort to fall into line with the shifted policies.
I can't say I necessarily agree completely though, impartiality is something even the american justice system stops applying once proven guilty which Wendy most certainly has been. She and her mother ran a scam where they committed fraud, they've stolen animals and money from people. They have rubbed elbows with other thieves on a regular basis and they haven't stopped. Even if one wants to ignore all of the unsavory personal habits that are reprehensible (like the neo-nazi crap), she's a bad person. There's no doubt whatsoever that she's a terrible excuse for a human being.
I understand that you want to clean things up and make them more... professional. But a thief is a thief. A scumbag is a scumbag. Wendy might be a bipedal organism that walks upright and inhales oxygen, but there is no way in hell she's a member of the same species I am- or you are- or any other decent person is. She's something else entirely and something far far less.
I'd ask at what point the impartiality starts to actually hurt more than it helps. I'm not going to cry or whine about receiving a correction- again, your board your rules, I can follow them or leave... but with someone like Wendy, how many people are going to point out that she's a liar, a thief and a criminal and require similar... redirection? Is she worth the good people who will stand up and point their finger at her for the good of everyone who might not know any better and say "Terrible, absolutely horrible person. Wendy is garbage who nobody should associate with." At some point, the cost of protecting the feelings of something like Wendy is just too high. I'm urging you not to alienate members who are actually worth something over policy chances that force them to be polite to criminals, thieves and scumbags.