I know this probably isn't the "done" thing to say here, and the majority of people do take the KC thing very seriously, BUT, I would let her have the puppies too (if there is some) there are always loving responsible dog owners out there, who would happily home a non-registered pedigree dog. Some people do just want them as pets, and not to work or breed.
I use a baby gate to keep my dog and bitch apart, and so far, in 3 seasons, there has never been an "incident".
Good luck whatever you decide x