Honestly, I don't agree with her. I have my contract setup so that the design is delivered before the coding happens in a jpg. They approve then I get another payment.
I do understand that a lot of why we use Photoshop is going to be obsolete when CSS3 becomes mainstream, but the keyword here is Mainstream. It's not. And won't be for a bit.
As for the crashing of her Photoshop, that could very well be her system config and not the program. Photoshop very rarely crashes on me (Win7 6gb RAM).
I'm a bit wary to jump into HTML5 and CSS3 right now because the compatibility isn't there yet.