the dog is neglected - there is more than food and water to give a dog a decent life...and GSDs are not dogs that are happy being outdoors all the time with no human interaction!!!! I totally disagree with MadLab's comment!
I applaud you for your intentions.
Your plan for segregating the house areas is a first step. It will be a long road and the dog may never be good with the cats....you have to retrain this dog as if she was a puppy from the beginning.
I am sure quite a few of our posters will write out long detailed suggestions....I don't have time right now to go into details....but you should and can rehab this dog! She sounds like she craves human companionship....I just hope your BF's parents don't go and do this to another dog if you take this one into your home!
Csabre Sch1, Hexe Sch2, SG Bengal, Komet, Kira HGH & Kougar v Wolfstraum ~ Ziberia BH ~ ATB Danger Sch1 RH SAR ~ Kougar Sch3, Kyra Sch3, Cito Sch2, Alice Sch1, Kelsey CD, Ret ~ Basha & Fenja Sch3s