I don't think she appreciates what is involved in this and I agree with the others that you should extricate yourself from the whole thing. I would take the tack that you are not confident, given that you are also a guest at the wedding with children who will inevitably be making demands, that you will be able to give the wedding photographs the level of attention to detail that they obviously deserve...so sadly, after many sleepless nights...you need to refuse this offer for her sake...
(...and yours LOL!!)
In the UK a lot of people approach colleges and Art schools for photography students to shoot their weddings. That's what a friend of mine did for her daughter's wedding and it worked perfectly. Maybe suggest that to her. You could use Katie's hugs and kisses book template:
http://www.designerdigitals.com/digi...oducts_id/7023
and do her a shutterfly book with the photographs you take on the day (as a guest) so she has official pics and more relaxed ones too that you will be happy to be responsible for!
Good luck!
Fiona