Project Management Central
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I have worked on projects where the sponsor was an actively involved team member and it can work well when they understand which hat they are wearing in a given context. It can also be very helpful when issues or decisions emerge requiring sponsor approval as those can be addressed efficiently.
However, if your risk assessment indicates that the downside of her participating in both roles outweighs the benefits, I'd recommend having a candid 1:1 with her to share your concerns and plot a path forward.
I've worn many hats, alongside being a project manager: business analyst, product manager, change manager...
As long as the roles are well understood, and don't let one overshadow the other ones, anyone can take on multiple roles.
Sorry for being categoric but sponsor must be a team member always. If not, you are willing to fail or putting it in other words you have a "high level" project risk. With that said, the level of involvement usually is lower than other team members. Stakeholder analisys matrix will help you to define it.
She may need to be a team member due to her expertise. Could you find another project sponsor - perhaps her supervisor or the person who assigned the project to you?
It can certainly be challenging trying to lead someone who was the previous technical SME, and is now in a leadership position. It can be a "speed of trust" issue. They want to hold onto doing the technical part because they don't trust others to meet their expectations.
That can really slow a team down. They become the critical path. What you might try is laying out the schedule showing that the plan is dependent on how quickly the sponsor/contributor can produce content. If you want to go faster, you need additional resources at that choke point.
To help with their resistance due to a perception of quality, ask them to pick who they trust to do a good job and if they're the sponsor, they should try to bring that person on the team. They have to trust *somebody*.
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