Ooooh, that really does sound bad!! I am mother of a 3 year old son, and things can get out of control sometimes. But kids of 3 years of age know what they do to another child when they scratch so badly. I really feel like you need to protect your older girl. I'm sure it's both girls fault when they fight, but you have to make sure that the little one knows exactly when she has gone too far. Is she watching tv yet? If yes, you could have her banned from watching tv for a week. Or something else she likes. just so she knows that she cannot ever do that again. And you could tell her that siblings have to stick together at all times. she might not listen to it now, but i believe it's good when they start hearing that at a young age. Well, I hope your girls will get along a little better in the future, but a 3 year old can really freak you out ;-) so don't believ your daughter is the only one to go crazy sometimes!
best wishes,
steffi