AITA for ignoring one of my closest friends for lying?

I’m writing here because I genuinely have no one else to talk to about this.

So, this girl in my friend group (i'm gonna call her Sarah) has been known for being a liar. A few of us thought some of the stuff Sarah has lied about in the past was weird but continued being friends with her regardless because she was one of our closest friends and I genuinely loved her and valued our friendship.

That was up until recently when she started acting a little off (wanting attention all the time, constant need for male validation, putting me down in classes and acting weird when a friend's ex was around). Obviously I thought it was weird, but I always try not to judge in case there's stuff going on at home or maybe she just has a lot going on, which I know still isn't an excuse but I understand how when you have a lot going on it can change you.

A few days ago, Sarah and one of my other friends (i'm gonna call her Gia) fell out. Gia finally confronted her about how she has been acting and Sarah did NOT take it well at all. At school, I still spoke to her as I didn't want her to feel uncomfortable when hanging out with us.
Things seemed to sort of resolve on its own and it was less awkward between Sarah and Gia when we all hung out.

That was until yesterday. Sarah made up these lies to Gia about what happened at a party at the weekend including one of our friend's boyfriends potentially cheating with another one of our friends. At the time we thought it was the truth, but when Gia told our friend group what Sarah had said, another one of our friends (John) decided it was the right thing to tell the girl (who allegedly got cheated on) that her boyfriend had cheated. This resulted in John getting called by the boyfriend and getting yelled at saying it wasn't true.

When Sarah was confronted she said it was a mistake and she got the boyfriend mixed up with someone else, but didn't even apologise.
She also claimed to be sober whilst witnessing the cheating but when I saw her at the party she was PISSED, so i know that was a lie too.

The friend group and I have been ignoring her since and I shouldn't feel bad, but I do. Whenever a situation happens when someone looses their friends or gets ignored by their friends, even if they are in the wrong, I feel so deeply for them and it genuinely makes me sick to my stomach thinking about it, if that makes sense. I have been told that it's because i'm a really empathetic person but these feelings make me think that ignoring her is the wrong decision.

So AITA for ignoring her when her lies almost resulted in a friend's breakup and for another friend to get yelled at.

Also sorry if this does not make sense i'm really bad at explaining things but I really want other people's opinions on this.