Hi Stacey,
I have this situation on a regular basis with students transferring into our college. Many of them feel the same way as this student and want to "kill the messenger" meaning me the instructor. I explain as you have done that it is not my decision about her having to take the course again. Then I sit down with the student and talk with her to see if we can find a special project that she can work on to demonstrate her knowledge of the course. Depending on the nature and complexity of the project I then waive some of the more basic requirements of the course to show her my understanding of her situation. This generally wins the student over and we get along well for the duration of the course.
Gary
In my experience, the student (that you described) or a student with significant experience, may not be as learned as they profess to be. This is something to consider. Also, assignments (i.e. projects) that may be more difficult can challenge that student where they are at academically, and help make the course more palatable to repeat.
Maybe you could appeal to her by explaining how much she can offert to the students who have never taken it before.
The best way to really "know" something is to teach. If she looks at herself a little like a guru or yoda, she might like it better.
