After ranting about this particular person, I think I have solved the matter. First, it was perfect timing that I met someone the previous night. It was just a casual bump at the mall while we went for dinner.
But one little carefully worded sentence on an email is enough to give Madam Paranoid the impression that I had met up the guy to plan our world domination. I said, "Oh don't worry, we met last night and he said he is coming to the meeting." So, Madam Paranoid probably cooked up a whole cauldron of conspiracy soup in her mind and refused to attend the meeting. And during the meeting, I finally got to rant in person why I feel hurt that she had put me in a bad light. No confrontation needed. And yay, her service is probably not required any further. Now, that is satisfaction! iRules!