Are these people the kind who are always flaunting their material wealth? Are they always bragging about their latest acquisitions and expenditures? If so, they yeah, ugh. Not pretty and not nice.
But if not, then I tend to see this in a slightly different light. Not so much as bragging and flaunting but more along the lines of "I'm so thrilled at all this cool stuff and I want to show it off." Granted, she is sort of playing this to the wrong audience because I can see it as coming off sounding like, "Here's all the cool stuff we're buying off the backs of your labor."
But since you said they have several parties like this a year, I'm guessing she probably planned a similar party for her friends/social group and then just repeated the party for the employees without realizing how it would sound. Unless she's one who has displayed this insensitivity as part of her personality, I'd give this one faux pas a pass and just assume that her intentions were misplaced rather than intentionally malicious.
It sounds like the first time they've hosted this kind of party for the employees at their place. Maybe next time it won't be so much along those same lines since it won't be the first time everyone's seen it.
But honestly, regardless of any of that, I can't see saying anything at all to them about where they host a party. If they want to host it at McDonald's or at Chez Expensive or at their home or wherever, it's their call. They are hosting. You can go or not, you can be annoyed or disgusted or whatever, but you can't really say anything to them to make them think that their hospitality was somehow lacking.
Well, I mean, you can, but if you''re worried about the repercussions of not going, imagine the repercussions of sending that kind of message to them.
And anyway, yeah, I think it's rude to hint at them to change their venue.