>Dude looked her dead in the eye and said "I don't understand"
>and she lets him walk away? Not buying it.
>What makes her think he's not running straight to the FBI?

It was very unlike her, but it seemed that was the point. We saw somewhat of a preview of it when she almost didn't burn the painting. She knew she HAD to kill the kid, especially after he didn't take the initial out she tried to offer him, and still couldn't do it.

I think it's a combo of her going non stop all season (and i guess the past 3 years) on her own. Phil telling her she lacks humanity, and questioning what she's fighting for. Even if she disagrees with Phil, she respects the shit out of his opinion, plus he just proved how down he was for her in Chicago

Erica was a fellow strong woman staring down death, and forcing liz to be in a room with her and reflect through art. Liz didn't get why the art got to her so much. she just knows it did. Erica fighting like mad while she was mercifully killing her. Everything with Paige... Chicago... the sheer amount of killing she's been doing.. I think it all finally got to her.

The Gorbachev stuff just sealed it