There's good advice in Dear Prudence on dealing with an "overly sensitive manager." I'd also be willing to call the manager a crazymaker:
Prudie advises managing the manager quite well. I've had several "overly sensitive managers" and being direct seemed to help, something along the lines of, "Gee, I would LOVE to get together this weekend for Pilates, but we'll have to wait until you're not my manager." Anyone else had an "overly sensitive" manager?
My manager is extremely sensitive, the sort who borders on being self-involved. I can honestly say she's been a very good boss professionally, but personally she is driving me crazy. She and I are friendly, but she's pushing for us to be best friends. I enjoy her company, but want to keep it business-friendly; after all, she does my performance review! If I'm not overly animated and happy to see her, she assumes I'm mad at her. She then asks around about whether or not I'm mad at her and what she did to make me mad. If I see people from the office on the weekends, she'll sniff out all the details (which I do not broadcast), and then ask me about it, informing me about how much she can drink or how late she can stay up or how she would have added to the fun.