Hello leafedh, welcome

I understand how you must be feeling right now, you have a BPDDIL who you are struggling to relate with, and you have lost your first DIL, who I’m guessing you got on well with? How long have your son and his current wife been married? Are the three children from this marriage?
I don't understand how my son can take this kind of relationship. He says he's happy but I don't see that.
What do you see that makes you think that your son is not happy?
I think that she takes medication but I am not sure. I do think she goes to counseling and she at least is aware of her disorder
Do you know when your DIL was diagnosed?
I just wish I knew how to better be around her and not take the mean and cruel things she sometimes says to me to heart. It's very painful. Now that I know that it's not just all me I will look for help and ways to cope with her. She has divided my family and my step children do not want her or my son around at all. It's difficult for me as I want my whole family to be together. Any suggestions on books or websites would be very helpful and again, just reading this is so helpful.
It is difficult I know to not take things that she says to heart, it can feel like a personal attack but it is part of the disorder. You are wisely taking a positive step, wanting to learn new things to help you cope with being around her. I am sorry to hear that you feel that she has divided your family, and I understand your wanting your family to be together, sadly that does not always happen, and we have to accept that. Are your stepchildren aware of her diagnosis?
I am glad that you have found this site, you will find it extremely helpful and supportive.
A good book I can recommend is Loving Someone with Borderline Personality Disorder by Shari Manning.
I look forward to hearing more from you x