That must have taken you a lot of courage to tell her.
But yeah, her reaction is odd, to say the least.
Erotic transference happens all the time, regardless of the patient's sexual orientation, how does she not know that? Did she think you were hitting on her or something?

She should have validated your feelings, instead of "drawing a line".
Saying "I'm heterosexual" to someone revealing their feelings for you is appropriate in real life, not in a therapy setting.