I'm not sure why people think the narrator didn't know the man she was having an affair with was her friend's husband. If they're such good friends, how could she not know who her husband is? There's no evidence in the song to suggest otherwise.
Anyway, I'm pretty sure she's defending herself toward the end:
Let's not forget ourselves good friend
"I am flawed if I'm not free"
That "flawed" part is what the friend used to say, so the narrator is throwing her (the friend's) words back in her face. That's why distortion is used in the vocals right there. But it doesn't matter, says the narrator, because "your husband will never leave you for me."
That's how I took it.
TooLongAwakeon February 11, 2006 Link
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