I may be in a different situation because I think I'm slightly older, and I have what can be referred to as a "smart mouth", but I would just go along with it.
I probably would have responded to that with something like "YEAH I KNOW RIGHT LULZ STIRRUPZ R SO BAD FOR HORSES THEY CAUSE CANCER!" and go about my daily business. She can't say I was being rude because I agreed with her in a sincere tone, but I've still pissed her off enough (hopefully) that she won't talk to me ever again.
It's a great strategy in situations when you're dealing with idiots that have no power, or other say about anything relative to you. Now, were she the BO I'd probably shut my mouth and leave and never come back.
OK MY BAD. I just re-read, she is the BO. Run away quickly before she tries to sue you, or send animal protection services after you.