The long answer is that you'll have to answer the question, "What do you hope to accomplish?" That answer will guide your actions. If your goal is to stop her from using her Facebook account in violation of the rules, then you'll have to tell her directly or report her. If the goal is to avoid seeing ads on your feed, then you've already done that so again, your only further option is to tell her directly or report her. The simple fact is that you're dealing with someone who's breaking the TOS to advertise, and it's unlikely that she's entirely unaware of the effects on others. So telling her is going to cause some level of confrontation.
The short answer is that, given that you say you want to tell her that she's violating the TOS without unfriending or reporting her, your only real option is to tell her. If you want to avoid accusational language, then just tell her the facts. "It's against Facebook's TOS to post ads on your timeline. Just giving you a heads-up so you don't get your account deleted."