I don't see how you can have a dog with 41 champions in a 3 gen. pedigree as there can only be a maximum of 14 dogs in the first 3 generations
. My Bonnie has 46 champions in her 6 generation pedigree (54 if you count the ones that appear more than once separately). Maybe you meant something other than what you stated?
I can sympathize with wanting to breed an exceptionally beautiful girl. I was confronted with that same situation with my Heidi. I purchased her with intentions of breeding her. She is an exquisite little darling and was charting to be of breeding size. She, however, stopped growing and only reached a little over 3 pounds. I REALLY wanted to breed her but did the responsible thing and had her spayed. She now reigns as our House Princess.
The following is what the YTCA says about breeding size for females.
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"All breeders may occasionally have an unusually small Yorkie (hopefully healthy),
though no responsible breeder breeds for this trait. Many breeders prefer a
general weight range of 4-7 pounds believing that size retains desired Toy
qualities while maintaining optimum health. The Yorkie Standard states weight
"must not exceed seven pounds" and as a prospective pet owner you should
realize that even at 7 pounds, the Yorkie is still a small dog. (Females weighing
less than 5 pounds are considered by most breeders to be unsuitable for breeding.)"
(Taken from the FAQ section..."An important message about "Teacup" Yorkies)
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While there is no guarantee against complications during pregnancy and whelping with a girl of any size, breeding under-size females certainly places an additional risk on the Dam (and pups) and I would hope you would re-consider your breeding practice as it pertains to your 3.7 pound girl.