Well I'm glad you didn't laugh in her face but no, you don't have to make her something at a loss to you. If you have a Joanne's ad handy, show her the price of fabric today and explain how much you would need for her project. Most people do not have a clue about fabric prices. If you want to throw in your labour for free, that is up to you but be warned she may be a repeat customer if you do.