Your logic is flawed in your rational. It is based on lies, deception, and lack of moral character which all are important ingredients for resulting in the truth. You are thinking with your small head.
If your logic was built on truth, and honesty you would have never flirted with her in the first place.
Your logic aligns itself with one being jealous of your friends success, so you try to tear it down, and degrade the woman instead of acting as a gentleman and respecting her, and especially your friend.
I know you said she initiated the play, if she is made from that cloth, then your friend might already know, and accepts that behavior, or he will soon find out on his own about her play, and have his own conversation with her, or depart.
You should only engage this if your friend approaches you for advice, other then that be respectful, and supportive of all your friends.