Holy cow! I lost count of how many adult "breeders" they have!!

This is definitely a puppy mill IMO. I don't care how neat and clean they say it is, they obviously run this as a business that intends to turn a profit. Were Lily's littermates male or female? That may have some bearing on why they're still there. Or maybe Lily just wasn't producing big enough litters to be profitable. Who knows.
I can't address the issue of the rescue group you got her from. I got my biewer, Jordy, from a rescue group that obtained him at a Missouri puppy mill auction, too. This was not a case of the miller going out of business, it was just an auction where they were discarding some of their unwanted "stock".

I know this local rescue had the very best of intentions, so just try to have faith that yours did as well.
This line in the reply you received really stood out to me (sorry this is slightly off-topic). In today's world of concern about our pups being over-vaccinated, these people are actually bragging about it like it's a good thing?!?!?

"She has had all her shots and worming and I guarantee you allot more shots and worming more than most pups get."
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He is your friend, your partner, your defender, your dog. You are his life, his love, his leader. He will be yours, faithful and true, to the last beat of his heart. You owe it to him to be worthy of such devotion. -- Author Unknown