Oooooh, these boundary disputes are a pain.
I presume it isn't obvious where the actual boundary should be. Nor can it be determined exactly from the deeds.
I think the fact that this alledged infringement took place 2 owners ago puts her claim on a rather dubious footing. Why raise the claim now? Are you aware of any ongoing legal dispute that has been taking place over all this time? Again, I assume no. I'd say she's just punting for a few inches more garden. Ask her to prove her claim and see what she comes up with. Can you still contact the person who put up the fence? They would be an excellent 'witness' on your behalf.
Personally, no, I wouldn't move the fence now, just on her say so.