If I were you, I'd be very concerned about this turning into a legal issue. Two things make me concerned: 1) By your report, she's a chronic complainer. If she's already feeling compelled to come over, bang on your door, and yell at you, she will likely pursue additional action if the problems continue. 2) If she pursues legal action against you or files a complaint or anything, you as the dog owner are much less likely to come out on top. Here's what I suggest:
Start your records now. Write down every interaction with her - Send an email to yourself or send a message to your mom or someone you know and report what happened, when it happened, and what caused it. Keep informing Citizens Affairs (or whoever you can formally report to) to establish that she complains a lot in case she tries to bring a complaint or lawsuit against you.
Be genuinely apologetic. Do not antagonize her or snuff her because that will just escalate the situation.
Make sure you are within all the regulations for your home zoning code/county/state regulations, laws, licensing, etc. Make sure your homeowner's insurance would still cover you if they knew you were boarding strangers' dogs. (They probably won't from what I've read from others here.) I suggest this because, if this turns into a legal issue, it will be much more than a "ugh, I got a noise complaint" or "geesh, I can't believe I have to go to court for this" kind of thing.
Change your activities. I know you don't want to or don't think you should, and you may be right, but stop mowing your lawn at 6:50 in the morning (or 7:50 for that matter). If I were your neighbor, I'd be pretty peeved myself (admittedly not nearly enough to come over and yell at you). Instead of letting a dog out in your yard unsupervised when you know it is likely to bark, take them for a walk down the road away from your neighbor's house because again, if I heard my neighbor's dog barking at 5am, I'd be peeved (though again, not enough to talk to you about it). Personally, I try not to do anything loud between 8pm and 9am (10am or 11am on weekends), depending on my neighbor's schedules and whether they have small kids (with early bedtimes).
Remember that everyone is going through something. One of my favorite quotes is "Be kind, for everyone you meet is fighting a battle you know nothing about."
I hope this was helpful. Good luck!