Yes, just blow off the busybodies. If she can manifest some reason it has something to do with her, she can tell you or she can fuck off.

You don't have to entertain every crazy person that wants to talk to you.

Let me just put this out there, though: this sounds pretty even steven to me. I am not minimizing child-on-child victimization. I've seen it, it ain't pretty. I am not saying it is okay for them to be doing what they are doing. But the girl's mom seems to have a handle on the situation. Kids start feeling sexual well before their respective ages. They get curious. They want to see, to touch, to play. It's pretty normal behavior, even if it should be discouraged.

But this is....incredibly sexist.

Look, I was the horndog kid, and I was a girl. I was all about playing doctor. We demonize boys, especially because he's older, and I am not sure that's fair. Before you stick him in a bunch of therapy, before you freak out and think he's some sexual deviant, you might just want to have a talk with him about masturbation. Like..."Hey...from now until you have adult or nearly-adult relationships, your sexual relationships are with yourself. Go masturbate when you're ready. Keep your hands to yourself, on yourself, and don't touch other people".

Girls, even eight year old girls, can be sexually pushy. So can ten year old boys. So can ANYONE, which is really my point. Their age difference isn't so big, it's pretty fucking common just not discussed or discovered. MOST of these incidents are either not talked about until you are an adult because they aren't traumatic. Embarrassing? Sure. But traumatic? It depends. And since the mom in question is being cool with it, I'm guessing there wasn't trauma, just a sense of "I'll show you mine..." and that's just a part of growing up.

If I had to watch a highlight reel of my slumber parties, I'd fucking die. That's all I'm saying here.