They explained she was making an effort to intervene in past cases, but she had just become so distraught and defeatist, since evidence is not something you can really get when it comes to bullying... or, at least... it doesn't come in the form you expect. You'll see soon enough what I mean.
Sure, you can call her a bad teacher, but I'd just say she was a battered and weakened one. She didn't have any more fight left in her to stop what she knew was wrong, and felt like she couldn't actually do anything meaningful about it in order to actually end it. Basically, we weren't privy to the fact she's had a long and unsuccessful history of fighting bullying and she just gave up this time before she even tried because of those past failures.
The head teacher is a good one, though. Kokubu will straighten things out. It takes awhile to get through to Takagi, though.