If his wife is having mental health issues it is best that she seeks professional help. If she is unwilling to do so, there is not much you can do. You can encourage him to have her seek help in the form of therapy or family counseling. If she has some sort of a personality disorder (such as antisocial personality disorder or narcissistic personality disorder, etc.) versus another condition, personality disorders are not cured per se but if she is willing to work on her self, she can learn to manage her behaviors. If she is not willing to do anything or acknowledge her behaviors, it may be best to ignore her. If you confront her she may only become more angry. Just pointing to her how her actions affect others won't guarantee that she will change or even admit any wrong doing on her end.
If she is posing an imminent threat to self or another, she ought to evaluated at a local hospital.
Otherwise, continue to be supportive to him and try to let him make healthy decisions for himself as to how he wants to handle this marital issue.
Her therapist says there is nothing else she can do--not curable in any sense.My brother needs to divorce her for his own well being.She is very cruel.He has the obligation thing --she has worked on the victim thing to the hilt and he bought it.How can he do this without feeling so guilty and obligated to stay with her?
He will have to address his underlying feelings of guilt/obligation. They may have resulted from (her victim role) being played on him like you've mentioned. He'd have to realize and accept the fact that she is the way she is and that he can not take responsibility for anyone else but himself only.
When Your "Perfect Partner" Goes Perfectly Wrong: Loving Or Leaving The Narcissist In Your Life by Mary Jo Fay (Paperback - April 2004) - Unabridged
Time to Break Free: Meditations for the First 100 Days after Leaving an Abusive Relationship (Paperback)