I think the befriending on Facebook is totally out of line. I also think including the children is out of line, unless they are adults perhaps?

However, I don't think that meeting up at a therapists house is necessarily bad. I'd wager a guess that everyone knew ahead of time and could decide for themselves if they wanted to go. Spouses were probably invited so clients didn't have to go alone. If you choose to go, it's not breaking confidentiality. You already know the situation.

A lot of people lack social acquaintances or lack skills to gain friends. If all parties know what is involved, I don't see how that is really a problem. It could be very healing for a lot of people. For those, who wouldn't want to participate, they wouldn't have to go.

A lot of therapists work out of their own home, too, so meeting at their house could be very normal anyway.

The OP mentioned that her friend goes to therapy, not for one specific reason. It could also be that the people this T sees are generally more stable vs. those who are chronically struggling.

I mean, there are a LOT of variants that could be happening here.