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It's good that you've already expressed your feelings and concerns for yourself and the team. So, in essence, you've done your part. Make sure you stay on top of your tasks and your performance because a manager who is insecure and micromanaging people to the point of this level of concern may take your feedback as a threat and not respect the place you're coming from, so tread lightly.
Can you go above her head? If everyone is feeling that way, it might be worth going above her and talking to a more senior manager.
I'm glad you feel some empathy from your coworkers so that you realize you are not alone. Unfortunately these situations are difficult to change, and not all managers are great one (not always aware or willing to admit wrong). I would advise you to consider switching teams or even companies
Honestly, there's so many people like this out there - I usually take it as a sign of stress or really, that they aren't a good manager and don't want to confront that reality. I guess you have to go above their head att this point if they're not listening right?
From the sound of things you may want to do what you can to join another team unless you believe the manager is about to move on.
I e seen the best employees ever just do the head on desk like a bad hangover and the boss lets it go because he's a sweetie who rides a bike and doesn't pollute the environment.
Yes welcome to Disney with fake bosses