She believes that her sister is Mentally Dead, and is in effect just a walking corpse being puppeted by her 'Master', and that the only way to free her from this is to kill her.
And here's the thing, I think she actually does have a point there. When we first see "Her Master" it's in her big Saucelessness induced Panic Attack Coma State, where he almost infests her nightmares. Then later on, I had trouble finding it, but there's reference to one big contract that 'Shue' took on, to kill 'The Taoist' or some such, and this contract is one she technically failed, despite supposedly killing the target, because part of the contract was to dismember the corpse and mail the pieces to some of the aggrieved parties. We now in this chapter also see her Master having an almost precognitive understanding of how to manipulate her, represented visually as a shadow monster possessing her body.
Personally I think one of the twists, given the supernatural stuff that's already happened and 100% exists in this story, as well as things like her Hair changing color when she's shocked and all of that, I'm going to put forward the idea that she did actually kill 'The Taoist' who was actually her Master, but his consciousness now lives on in her sub-consciousness and is trying to take control over her.
It won't need Death to cure it, but I do think that's a thing that's going to happen.
It's either that or her Master is just still alive which would be pretty boring.