Well said. I don't know that much, but I would say she might feel cramped, and therefore doesn't go all out. My college friend said her horse is like that, and races the best in a certain arena, due to it's size, and doesn't do well in smaller places.
But running smaller patterns might help, don't push her to hard. There was this woman who was lungeing her horse in a pen that was too small, and one day, he went bonkers and tore the metal panels down to get out :/
Lettin' the cat outta the bag is a whole lot easier than puttin' it back. -- Unkown