In this arrangement with you as the only breadwinner, you ultimately have a say in all of her spending because you're the source of her income. Say you both have $200 to spend on whatever you want. If it's little ponies or going around giving $1 to strangers, it doesn't matter as it's your choice. In this scenario, she chose to give it to her brother, which you disagree with. What is going to be your reaction? Respecting her decision to spend her discretionary budget, or limit her budget, prevent her from spending it on things you don't agree with? Whatever the option, you have some degree of power in her decision.

If she has a job and her own source of income, then she can make the decisions all on her own about what to do with her budgeted "me money." And for what it's worth, I would've helped the brother once if it's the first time he's come to her/you guys for help. For my siblings/parents I would do this once and hold them accountable after. And if they fail my expectations, then I cut them off financially. Not before. But that's just how I personally would approach it.