I understand. I must hurt to watch your child be teased. You said she is 7 right? So that's old enough to talk to. Has she said she is bothered by this girl teasing her? Maybe if you speak with her you can help her make the decision to stop doing it around this girl or in circumstances where she feels bad. It'll probably be much easier for her to stop if she comes to the conclusion that it will help herself (with a little nudge/suggestion from you). You can also talk to the 3y old (since she is in your care) about being nice and not teasing people.
Now I don't know if you do this or not, but if you are trying to correct your child in front of the 3 yr old often, then the 3 yr old learns from you that the behaviour is wrong. And that will not help the teasing. So that's something to consider as well.
Good Luck to you and your daughter!