moonhoney2,
You are among friends and fellow arthritis sufferers. I, too, got a diagnosis of osteoarthritis in my hand and shoulder about a year ago. It was a shock, and I believe that is where you are now.
Eventually, I realized that I am in this body for the long run --my parents are 85 and 90 and still going strong! -- so I just have to adapt. I have also taken up quilting recently and am learning how to adapt to what I can/cannot do as I go. For example, hand work is very difficult for me -- so fagedabutit, that's what sewing machines are for. I don't do any hand sewing, but nod wisely when people say that all bindings must be done by hand. Hand bindings are beautiful, but I no longer participate.
Also consider this, with osteoarthritis, some days are better than others. I can go for a week with no arthritis pain, so I quilt when I can and take a sabbatical when my hand is stiff.
I urge you to take your time to think about the situation. It may take some time for you to move on mentally to the "acceptance stage," but it will happen and you will realize you have much to be thankful for. Some of the quilters on this board can't quilt like they wish because of other responsibilities in their lives: raising kids, a full-time job, caregiving for family members, lack of work space. Arthritis.
Daily, I am reminded of my physical abilities and grateful for what I CAN do. The limitations of arthritis (and all other chronic diseases) are annoying; that's a fact. While you may see arthritis as a big fat steel door that has shut you in, just climb out the window and keep on going!