Thank you all so much for the wonderful suggestions about how to deal with siblings who interrupt each other during lessons.  I used several suggestions and it helped- to a degree.  This student is going to be a handful. 

I decided to “lay down the law” at the beginning of the lesson.  I directed my comments to the 7 year old because I figured the 17 year old would understand that the comments were meant for both kids.  Maybe I should have done it the other way around, because the 17 year old was an angel, while the 7 year old made me want to tear my hair out!

I told the 7 year old that while her older sister was having lessons, her job was to stay on the couch.  She could listen to my CD player with headphones or sit quietly.  She could NOT interrupt us.  She listened to the CD for a few minutes while I praised myself for an ingenious idea (even though it was a reader’s idea).  Then she got bored and started playing with my baby, taking toys away from my baby, crawling around, talking etc.

I had to sit her back on the couch and say to her, “You made an agreement with me at the beginning of the lesson.  Remember?”  She was apologetic and repentant and was good for a few more minutes.  Then, while crawling around on the floor (yet again), she found my baby’s books and read them.  It kept her occupied so I was ok.

In the confusing state that was quickly being created right there in my living room, I forgot to use one tip I really wanted to use- giving her finger drills to quietly play in her lap.  I will try that next week.

I told her she MUST bring books (plural) to read next time.  Any further suggestions would be much appreciated!