parent teacher relationships

My children go to medium sized elementary school, which has a very
active PTA and parent participation is high.

Two of the parents in my child's third grade class have formed very
personal relationships with the teacher, one of the mother frequently
socializes with the teacher outside of work (shopping trips, movies
etc), the other family has taken to inviting the teacher to their
social events, such as holiday parties etc. This teacher is not a
transplant, but grew up in a community nearby to the school district
and appears to have family and friends independant of the school.

Several of us parents have concerns about the appropriateness of the
external friendship that has formed during the first course of the
school year betwen the two sets of parents and the teacher. We feel
that the teacher has crossed the line of professionalism, and that in
several recent cases involving the two children of these parents, she
has shown a decided bias in her decisions. This bias has been
particularly glaring in the case of one of the children, who has had
consistent issues throughout grade school, and now is being given the
"benefit of the doubt" in every situation that arises.

My question here is what is the appropriate relationship between
teachers and parents? SHould we begin to engage the principal and when?