So, she's fugly, right?

Two possible explanations: (1) Friend has a very high opinion of their attractiveness. (2) Friend isn’t “out” but she has a crush on you and was hurt that you were not feeling that way about her.

My best friend (we've been friends for over 30 years) is gay, and although he's never told me he's attracted to me, I have irrefutable evidence that he is (or at least was). I was surprised by how little it mattered to me; I didn't expect to feel repulsed or paranoid about being alone with him or anything, but I guess I did expect it to changes our friendship in some unknown way, and it really didn't. My version of your friend's reaction is with Christians. I'm an atheist, and I don't hide that. And there are a lot of supposedly religious people who really don't think about it much, occasionally go to church, and really don't live their lives any differently than if thy were atheists; these people don't bother me. But the real, true-believer Christians, to whom it's a big part of their lives-- it bothers me that they make no effort to convert me. Like, they think I'm spending all of eternity in hell, and it means so little to them that they'd rather avoid some awkward talks and potentially embarrassing social situations than try to save my soul? I mean, I'd dislike the actual attempt itself, but the fact that they don't make the attempt is borderline offensive to me.

that’s still homophobia but in a different way. not like the grossed out/mortified for some other reason. but harboring the opinion that you should find ALL women attractive (including her) is a homophobic stereotype.