I am very sorry this happened to you. I guess I would want pictures showing the damage........just saying. You've used her for years and she's probably on the "up and up" but I'd still want to see. If nothing else, it could help give you closure because this is a large loss with all the effort and time put in. One LAQer I used to bring my quilts to had insurance covering the quilts brought into her house in case of fire, water or other unexpected damage. If nothing else, ask her to check her homeowners insurance policy. From what you described, she is trying to make it right with you. I would definitely figure out approximate yardage used at $12.00+ a yard, the batting, backing and thread. You can't recoup your time unfortunately.
As far as a quick quilt, find something super-simple and yet the fabrics show through. Let us know how this finally gets resolved for you.