This is about as far from simple as you can get. I'm glad the Times reporter found her and got this out into the open but it's a horrendously complex issue.
I agree the gut reaction (fuelled by the tabloids) is to make her stateless, but that of course is illegal under the treaties to which we not only signed but of which we were the instigators. So I suspect that's a non-starter. Previous attempts by the government to try the same tactic have been defeated by the courts.
Naturally, the right-wing press are having a field day and the popular choice is to make her stateless and leave her where she is. The question being posed here, however, is whether that's the moral thing to do.
I would favour allowing her to return, then taking her child into care before charging her with membership of a proscribed organisation. That way we have her where we can keep an eye on her, and we might even learn something, although it has to be said she doesn't seem that bright.