Gosh I am so sorry you are going through that. It would make me think twice about doing it for a side-job, that's for sure! I think lessons learned are already discussed: have a contract, do the math, have them sign it, and have You actually look at the quilt before giving a quote. I'd have had a mild heart attack looking at trying to get it even and tight around all that cording.
Personally, I think this is a matter of moving on, learning valuable lessons, and try to let it go. If she is at a guild meeting and starts to flap lips negatively, simply state what happened, and I bet you won't lose a customer base. Likeothers have said….maybe she is just a P.I.A. and the sister can't even dealwith her.
Good luck!