Sue, if I'm getting this right, you've gone beyond what I presume your obligations were as per your contract. What I see from this is that the buyer, after refusing an offer to return the pup for a refund, went on to breed her....at only 1 year of age
. This person has no regard for this dog and looks at her as a breeding machine. That is obvious by her already having a litter at such a young age.
If you are certain you've satisfied your contract obligations, I wouldn't worry about any legal recourse coming from the buyer. What is troubling is how this baby has been used as a money maker at such a young age, health issue or not. If it were me, concern for this little girl would be my over-riding concern.
I doubt there's anything you can do to get her back at this time and that is what is so sad. This will probably be one of those hard lessons learned and I'm sure you're already considering how to better protect your pups in the future.
Since you know this person, perhaps you could contact her vet (assuming you know who that is) to see if there's any reason to be concerned about the health of the line you're producing. I can see that you've made an effort to not make this a drama thread, but perhaps you could give a heads-up if she attempts to sell these pups on YT.
Best of luck with this.
Jim