Hi Tinkie, welcome to TP
I'm sure you've read the stories in the papers when these disputes between neighbours get out of hand and someone does something stupid you do need to avoid that happening. I'd go and see the neighbours and show them you're trying to address the situation, that you're sorry about what's happening and what you're trying to do about it. If you stay on side with them they're more likely to try and work with you rather than against you/her.
The neighbours may well have known her for years and possibly have been friends, so they may be sympathetic but they do have the right to live in their house on their land unmolested by her and if it carries on they are well within their rights to call the police.
If an incident occurred the police may well attend and if she became aggressive use a Section 5 Public Order Act as she'd be "a person likely to be caused harassment, alarm or distress" or if she "uses threatening [or abusive] words or behaviour, or disorderly behaviour".
I think it is more likely that if this happened they would take her to the local A&E rather than the police station if they were aware of her having mental health issues.
Even if they attend and calm her down and defuse the situation it should still be reported to social services if they go by the book which may trigger some action.
In her mind, reality is as she believes it to be, just as it is for us all, her "misbelief" that she owns the land is just as real to her as your knowledge that she doesn't, so in her head you're wrong in the face of all the evidence she's the one who's right.
I'd ask the question what do you want to happen? You could report her to social services as a "vulnerable adult" if you google the phrase "vulnerable adult" followed by the name of the local authority she lives in you should be able to do it on line, that at least puts her on their radar, if she refuses to engage with them there's little they can do unless they feel the situation is so bad they section her and put her in care.
You could try and explain this to her but I don't think it would do much good, as I say in her head she's the one in the right.
It's sad but crisis intervention is the way these days and it's sad that the situation she may find herself in if she doesn't stop harassing the neighbours may not be somewhere she'll want to be if she doesn't stop.
Good luck
K