Well, at the assurance of my riding instructor that I am either going to get hurt or feel a little upset at giving my friend's horse a smack when she bites me, I decided to give her a smack.
I walked into the barn, she turned at me, with the usual sour look and struck out. I gave her a good smack and she backed off, looking very shocked. She tried once more (maybe she couldn't believe her eyes?) and I smacked her again. That was the end of it.
Although I still feel bad in doing that, it has (at least temporarily) stopped her from biting. I don't really think I can do much more, as the owner and another person working with the horse are using a riding crop-type stick to whack her if she bites, and I refuse to do that. She is being overworked as well, so I have, like I said before, discontinued riding her at all.
I don't think there is much more I can do at this point, as she doesn't belong to me and the final say is with the owner. I feel sad that this horse may be becoming soured to riding and maybe even people, but the owner seems to be pretty firm on what he wants done.
I'll let you know if anything further develops (hopefully it will be good news). Thanks again for all your support and helpful advice!