Am I wrong?

My friend tells her two almost 3 year old daughter to hit people because she thinks it's cute/funny. She will go "Isabella (her daughter) hit them!" and her daughter will punch/slap whoever her mother says to hit, and my friend will laugh and smile and/or say something like "good girl" or "you get them osabella!". Today, my friend came up to me when I was sitting and she was holding her daughter on her hip. She came up to me and told her daughter to hit me and she did. I yelled at her and her daughter. I said "Isabella you do NOT hit people!" and then I told my friend she shouldn't teach her daughter such nasty behavior. She thinks it's so funny and adorable, but I think it's disgusting that she tells her to and then applauds her for doing so? Maybe I'm over reacting. Idk.