re: How would you react?

Once one party has lost trust in a relationship, that relationship is over... she obviously didn't trust you to begin with, but now you can't trust her either. You two may talk it out, and come to an agreement that you trust each other, but the fact is once that trust is on it will never come back, no matter how much you lie to yourself that it has. She has an issue she needs to work on with insecurity, and working on it while shes in a relationship isn't the way to go about it.