I know this was posted a long time ago, but I just started reading these boards.
If you're still out there and wondering, it doesn't sound like the condom is the problem.
She's probably allergic to your soap, laundry detergent, or what ever was on you, just based on your description of where the rash is.
The general sweatiness from what you were doing probably just transferred more of it to her skin than would normally happen if you just hugged each other or whatever.