It sounds like things are generally tough all around right now. Don't feel like GD isn't working -- there are a lot of other factors in her life right now aside from your approach to discipline. Any approach to discipline is going to be negated by 1) stress 2) change in routine 3) a new sibling. These things are temporary roadblocks, but it doesn't mean you are failing.
Also -- 3.5 is a hard, hard, hard age for a lot of kids. It *will* pass. I promise. I think part of what happens at this age is a new level of awarenes.... children start to become accutely aware of feeling very intense things, but they don't really know what to do with those feelings yet. So it comes out in violence.
It sounds like your dd is having some strong feelings about the baby, but she doesn't know how to communicate those feelings or how to deal with them constructively. If I were in your shoes, I would work with her on finding words to *say* the hard things that she feels instead of lashing out. "Its not okay to hit, but you can say 'I feel jealous' or 'I feel frustrated.'" We even taught our ds to "shout" the hard things he was feeling at this age instead of hitting. "I feel angry!!!" eventually replaced kicking and throwing punches.
I would also probably work on trying to establish a predicatable routine for her. It sounds like everything you have been going through as a family might be taking its toll on her system. I guess it depends somewhat on her personality -- I have one child who relies a lot on predictable routines, and one child who could care less.
I also think that the consequence for violence should be immediate but temporary removal from the situation. If she hits/bites the baby -- she should be removed from him. If she bites you while nursing, then the nursing session needs to end until she is ready to stop biting. I often get a comittment from my 3 yo before I consent to nursing him. I ask him to repeat my words, and then I say, "I will not bit you or pinch you." He does better if he is reminded ahead of time, and aggrees not to.
Good luck -- it sounds like things are a bit crazy right now, but please know that it isn't your fault, and that it will pass.