I think you could pretty much remove almost all the words from your post except for these: "sharing", "Instagram" and "13".
Sharing posts on Instagram at age 13, regardless of the subject matter (and it could be as innocent as, say, bird-watching, or vegetarian recipes) can lead to problems. Sharing posts can open up a 2 way street that a 13 year old is unequipped to handle.
I wouldn't say anything about any subject matter, or what the posts are about, but I might consider telling the mom something like "oh, and if your daughter should ever be upset because my daughter doesn't respond to her Instagram posts, it's not meant to offend. I just wanted you to know that we don't allow our daughter to access Instagram." And then I'd be good and sure that your daughter doesn't have Instagram access, especially if she's the 12 year old. The age limit is 13, but parents should monitor all social media activity closely while their teens are young.
If the mom asks what the posts are about, or doesn't seem to know what Instagram is, or seems concerned, and asks for advice, you might show her Instagram or tell her how it works and how dangerous social media can be. If the mom knows about Instagram, and has decided to give her child freedom on social media, then that's her decision, and that's that.
If the other girl is a nice friend, just tell your daughter that her friend's loyalty, generosity, fun spirit, love of cats, whatever, is what matters. And if the girl tells your daughter personally that she is gay, your daughter should still focus on whether the girl is a good friend, a good influence, and just continue to demonstrate the same good qualities to that girl.