Oh Linda, what a crazy situation to be in. I can see why you're already emotionally attached to the little girl. She is so precious in her pictures.
I'm concerned about the little 2lb baby though. I think it's so risky to put a small baby under anethesia... but I guess if she is pregnant, then the risk is pregnancy is worse...???

My heart goes out to the little baby girl, and to you because I know you care for her now.
As painful as it is, just let the breeder do what she has to do, and let the puppy go. You can always call her up later to ask how the puppy is doing. Then at that time, if you feel in your heart that you still want her, then go for it.