I think you did the right thing, good for you for speaking up!
I hope she realizes that if she decides to breed that puppy, and everything goes well, well, when those puppies start showing signs of having that disease shes gonna have LOTS of unhappy new puppy owners, and shes gonna feel real crappy then....so you did the right thing! she will be sorry!
Friends of mine recently lost a 8 week old rat terrier/chichua (i cant spell) mix to parvo- and the breeder forgot to mention that the father was exposed to the disease a yr before...ummmm big NO NO NO! and they plan on breeding again!
some people are realllll stupid