From my understanding what you said and texting my friends, sounds like a paperwork issue. They never had trouble, but yeah, they lived in the Philippines. The issue in your case is that she doesn't live in the Philippines, so yes, she has to go there for the process because that's the only country she's a citizen of currently, although it would probably be possible to also do through a Phillipine embassy.

So they do accept Phillipine paperwork, but only official documents from the country itself.

Did you not have any official paperwork from there first notorized by the US? That's what's usually done in cases like yours, like my Highschool's friend's grandmother had to do when she got her US citizenship as well (so it's something you might want to look into anyway just in case).

That's probably your confusion on them "refusing" to accept the paperwork (although of course it also sounds like you had to deal with a racist cunt).

That said, it's weird for you to judge entire countries as super racist when you live in Alabama based off a few racists. I mean, even my black friends from when I lived in Texas didn't like stopping in Alabama. Just, something to consider for the future. I know racism can be extremely infuriating having experienced it both myself and seeing it done to my family, but you always have to remember that the asshole doesn't make the nation. Otherwise you end up also becoming what you hate.