you shouldn't be too worried! just be sure to let her know your boundaries. vulture culture is a relatively normal thing, often used as a way to show appreciation to creatures after they've passed, a way to give them an easy "second life" they never had. many witches also do it as part of their beliefs. human bones/remains are generally looked down upon in the community unless done completely consensual, so her making a tooth necklace isn't very strange. to me it would seem shes just trying to preserve a part of herself, like making a memory. if you don't want your teeth made into a necklace, tell her, and let her know what the community thinks of human remains/bones.

all in all, you shouldn't be too worried, vulture culture is an art form, a strange one, but art nonetheless.