Jesus...you're in a tough situation. Is she getting any professional help? Because as much as she'd like to think that you're responsible for her happiness, she needs to be able to cope with pain that comes with life without hurting herself. She really needs serious help.

I'm sorry I can't offer any advise on how to break up with her since I have never met anyone who cut themselves but whatever you do, I would do it gently as possible and maybe you could offer to still be her friend.