SORRY FOR THE LONG POST BUT THE DETAILS ARE IMPORTANT
Thanks dude. Here is the update: I would like to know if this was the right way to handle the situation.
So I went to her house party and was a good time. Danced with her and flirted as well.
However she was flirting a bit more (body language and eyes gave it away) with another dude we both know (as I suspected there was another guy; he happens to be the senior dance instructor in our place and I am the junior dance instructor; the HB is a relatively new dancer in the troupe)
So when we headed off to a club this continued as well. We were all dancing a lot around each other. But it was clear to me that she was always beside him and dancing with him (i guess she finds him more physically attractive as he is taller and a bit muscular). Occasionally I was dancing with her as well but then as i realized this more I disappeared and started dancing with other girls and went around the club.
So like around 2 in the morning the senior dance instructor leaves and it is just a few of us left dancing (few girls and her house mates and a dude who was hitting on her as well). They were on the dance floor and I did join them but made my absence felt as I disappeared time to time talking to other girls (but not that she could see them)
Finally we ended up at her home (8-9 people), had some food and so on. I was talking to her time to time. Towards the morning (5 am) nearly everyone left.
That's when she changed suddenly and started talking to me more personally. Saying why was i not at the floor dancing with her disappearing time to time like I was avoiding her. I told her it was her birthday and she had to be with people and it was not about me. I told her it was her who was avoiding me all evening. (I was actually pissed off she said that after having flirted with another guy earlier in the evening but I did not mention him or any of that).
She then started saying she was glad i was there and she was happy to see me. Then we started talking about how I was gonna blindfold her to make drink champagne (internal jokes). This is the point where she said she was confused as she was still seeing her ex-BF sometimes and that they were nearly broken off after 7 years. That she needed time on her own and was not looking for something. I said to that "well i am not asking you to marry me" and kept it light as if it did not mean much.
She said she was sorry and wanted me to be around and talk to her as we always did (my talk with her has always been sexual and flirty). I said I cant do that. I added "all that passion i see in our eyes, all of that you are just gonna let it go away, that's disappointing".
She tried to make it as if I was angry at her. But I said " I know we had a moment (the makeout session from 2 weeks before) and that I like you but that's the way it will be". She almost went into tears when I left (as she knew I was not going to be the same anymore)
I really like her but seems she has serious issues (flirting with other guys, ex-BF issues). I will run into her every week as we are in the same dance troupe.
1. Do i still flirt with her or really freeze her out (or worse be nice to her) ?
2. Do I make a statement if she sends me a message or chats to me again like "remember the next time u bitch to ur friends about not being able to find an amazing guy, tell her how u met one and managed to fuck it up" . what do i lose?
I would REALLY REALLY appreciate feedback on this since I am getting a bit frustrated with such stuff happening a second time to me.