Hi Meggs,
If it were my child, I would feel exactly the same way! My first thought, even before finishing your post, was that if you are paying her (especially), and she knows how you like your child to be treated, she should DEFINITELY respect that! Did she have an excuse for letting her CIO when she knows you don't do that? Or is that just what she does with her lo, so figured it was ok? Either way, I think if you're treating her as a normal babysitter, she should follow your directions with how to treat your child.
I'm not sure what you should do about it though, I guess it really depends on what you feel comfortable with. Other's will probably tell you to tell her how you feel, which might be the right thing to do, but if it were me, I'm not sure that I would. I guess it would just depend on who the person was, and if they'd be looking after my ds again or not. If you plan to use her as a babysitter again, I would definitely bring it up, and stress how you feel about the situation.
Oh, and try not to feel too bad for Grace--kids are SO resilient (sp?), I'm sure she didn't take the day as hard as you did. Although I can relate to how you feel--you probably feel like your baby has been neglected and mistreated, and what a terrible feeling.... But I'm sure she's just fine, so try not to worry about it.
Whiskers
P.S. About the poopy diaper--my ds has NEVER gone when he's actually sleeping either, so I'm pretty darn sure that's not the case! Maybe she went just after she woke up? I would hate to think that she slept in it. Poor baby!