Six-year-old Rikki was strangled and left posed naked in a star shape in woodland near his Peterborough home in November 1994.
His mother Ruth Neave was originally accused of his murder but cleared after a trial.
The case remained unsolved for more than 20 years before a cold case review allegedly led to a breakthrough.
The DNA of James Watson, who was 13 at the time of the killing, was found on Rikki’s clothes which had been dumped in a wheelie bin, jurors have heard.
On Tuesday, a former neighbour of Ms Neave was called to give evidence at the trial at the Old Bailey.
In 1994, Kelly Nuttall was aged 13 and living next door to Ms Neave on the Welland Estate in Peterborough.
Asked to describe how she treated the children, Ms Nuttall told jurors: “Appalling. She was a total and utter disgrace of a mother. She was evil.”
Ms Nuttall said Ms Neave would shout, scream and hit her children and treated Rikki the worst, even saying once that she felt like “killing him”.
But on the day he went missing, Ms Nuttall had spent much of the day with Ms Neave but never saw the little boy, she said.
Under cross-examination, Ms Nuttall was asked about allegations she had made against Ms Neave to police the day after his body was found.
The witness allegedly told police that she once “caught her with her hands round Ricky’s neck” and released her grip when she saw her.
Ms Nuttall also said she had heard noises upstairs and Rikki’s bedroom door was shut on the day of his disappearance.
Asked if she had “implied” Ms Neave was responsible for the murder, she said: “Can you blame me? She was horrible, she was evil to her kids.”
Ms Nuttall was questioned about saying that she moved Rikki’s body for someone she was “scared of” and was told to “spreadeagle the body to look like there was Satanism or witchcraft involved”.
She told jurors that she only said it for “attention”.
Jennifer Dempster QC, defending, said: “Did you move Rikki’s body in a pram or any other way?”
The witness replied: “No, I did not. That’s just sick.”
The prosecution had previously said that Ms Neave was wrongly accused of involvement in her son’s death, with evidence showing she could not have been responsible.
The court also heard a statement by social worker Deborah Lawson detailing a series of visits to Ms Neave and her children in 1994.
Ms Neave was seen “ranting and raving” but was not violent towards Rikki or his siblings, jurors heard.
On one occasion, the mother punched a wall narrowly missing the social worker’s nose in an attempt to “intimidate” her, the court heard.
She also saw Ms Neave “screaming and swearing” at Rikki for trying to steal some chocolate, according to the statement read out by prosecutor John Price QC.
On November 17 1994, 11 days before Rikki’s death, Ms Neave told Ms Lawson about a “murder story which she had been typing”, jurors heard.
On handing over a plastic bag containing the typed sheets, Ms Neave allegedly told her: “You might enjoy reading this but it might keep you awake – it’s a horror story.”
In the statement, Ms Lawson recalled: “I put the plastic bag in the footwell of my car.
“I did not attempt to read it as I did not have the time.”
After Rikki was found dead, Ms Lawson was asked to hand over the story to police.
Her statement continued: “Ruth would shout and swear and point her finger at the kids but would never physically hurt them.
“On no occasion have I seen Ruth physically abuse her children.”
Other witnesses have described seeing Watson with Rikki on the Welland Estate on the morning of his disappearance.
Watson, now 40, of no fixed address, has denied murder.