It doesn't sound to me like you really want to make this quilt for her. Here's my answer..Just say "No"!! It is certainly OK to say you only quilt for yourself. Its not worth the stress. We are not obligated to satisfy requests of acquaintances, friends, or even family.
On the price..I think many people assume they can get "homemade" cheaper than "store bought". If she really is concerned about the thought that goes into a gift rather than the cost and since everything she does is "the best", she won't really care much about what you charge her and should be willing to pay for quality.