A couple of questions, and then some thoughts as a parent whose kids made it through the teen years (relatively) unscathed.
How old is the younger sister? How old were each of them when you adopted them? What do they call you? Do you have other kids? If so, genders and ages? Biological or also adopted?
What *I* found as the parent of teens is that one must choose battles carefully. Some things are just not worth fighting - clothes, hair, lipstick/nail color, for example. Most of that is a phase and done specifically to get a rise out of you. YOU choose how to react. I always figured hair grows out, etc. Clothes choices - have YOU gone shopping with her and let her show you what HER taste is? No one said daughters must like the same things their parents do. The key is to help her find clothes that, even if you don't like her choices, fit her and help her feel better about herself.
I bet you don't like her music, either. Have you tried to listen to it? Like.... the lyrics? I found that, when I took the time to actually listen to the words (vs the "noise"), the meaning tended to be quite deep. Interestingly, my *mother* (in her 70's at the time) asked to listen to my oldest's music and found the same. (And BTW, I am not fond of the music my parents like, either LOL)
Friends of either gender.... I wasn't always fond of the kids mine befriended. Whether as friends or as girl/boyfriends. But I felt that knowing the kids, their names, who they really were as people was important enough for me to open my door to them. First impressions are not always accurate - whether they are good or bad. Some of the best-dressed, well-off, "nice" boys/men (or girls/women) really aren't. While many with tats, piercings, etc. would give their all to help. Invite him in. He IS (apparently) the father of your grandchild, and he will have rights should he choose to exercise them. You can't stop that.
As for your daughters only having ear piercings as "normal young ladies" do. I grew up hearing about how "young ladies" behave, what they do for "fun" and what they wear. It was a misery, and while I wasn't overtly rebellious, I had my moments. My main rebellion? Was when I had kids of my own - I threw all the claptrap I was brought up with out the window and raised my kids *my* way. I wasn't perfect by any means, but I raised two darn fine adults.
The long and the short of it is this - when you show acceptance, you hold more sway in other areas. If your daughter felt she had some level of control over her life (*), she might be more compliant in others.
(*) And she now has found a situation that you have NO control of. You cannot force her to abort or adopt out the child. While you can restrict Dad's access to his child IN your home, you cannot get him out of your grandchild's life.
Now, I'm not saying you're a bad Mom by any means. It's hard, even more so when it's a child you receive into your home at an older age, I'd imagine. Acceptance is key. Giving her some control over her life. Our kids don't always turn out as we expect them to (LOL the folks here know how well I know that!), but when we love them, we accept who they are.
It's not too late for you and your girls, not even your 14yo. Now is the time to mend the broken bonds. You can tell her that, while you regret some of her choices, you also regret some of yours. And that you'd like to start over in this new phase of your lives - her as a Mom and you as a GrandMom (and sister as an aunt!). That a baby - an innocent child - is never a "mistake" (and no, I am not a pro-lifer). But you all - as a family - are being given a gift. Tell her that you'd like Dad to join you for dinner, so that you can get to know him and the three of you can discuss life going forward. You'd like to get to know him. Tell her that you want be there for them as much as you can. But most of all? Tell her you love her and always will.
I bet that baby will melt your heart when you meet him/her.
ETA I may have other thoughts once you answer my questions.