Although Vicks Vapor rub is not harmful and is meant to be inhaled it is not meant for daily usage. Your friend seems to have developed a dependency on the smell. It is normal for certain scents to calm one and aid in relaxation. However any medication should be used as directed.
Smelling the fumes each night may have become more of a ritual at bedtime. Smelling it may not help her sleep but the routine of smelling may help her do so. You can try suggesting that she try not smelling it one night and see what happens.
You should talk to her and see if there are any other issues related to this habit. If she is using the fumes to get high and experience a feeling of euphoria, it is definitely wrong. Sniffing and inhaling any chemical is very dangerous and should be stopped immediately! Check out Effects of Inhaling for more information.