First, She's beautiful. I see why you love her so much. I'd keep her also.
Second, this type of hernia is upsetting but it's common and it can be fixed. Talk to your vet. I had a pup that showed a hernia when she was 8 wks old. Took her to the vet, they showed me how to put it back in place and to watch it. At 12 wks when we took her for the surgery to fix it, Dr P called and said that it had healed itself up and he could not make it herniate. To have it checked when she was spayed. At her spay, the vet checked and she showed no signs of a hernia. Others have to be fixed.
http://www.barkbytes.com/medical/med0068.htm
Inguinal hernia
An inguinal hernia is the result of abdominal organs, fat or tissue protruding through the inguinal ring. Inguinal hernias are presented as skin-covered bulges in the groin. They can be bilateral, involving both sides, or unilateral, involving only one side.
Inguinal hernias are more common in females than males, but do occur in both sexes. As with umbilical hernias most inguinal hernias will shrink and disappear as the puppy grows, although you must keep an eye on the size of the hernia(s).
Inguinal hernias can also occur in unspayed, middle-aged female dogs. This may occur as the result of stretching of abdominal tissue due to pregnancy, or atrophy of abdominal tissue and musculature due to advanced age.
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