I've always felt that the reason why Kathy feels that way is that she knows the Daughter(Amanda) likes her own dad. She feels like going out with him would be betraying her best friend since he's not only her friend's dad but the man her friend loves. It wouldn't even surprise me if the daughter knows about the stories and/or they are inspired by fantasies she told Kathy.I did as well. I don't know if it was ever the authors intention, but it seemed like a lot of the elements building up to the Kathy relationship suggests that she is your real daughter. I've thought this since her reactions to the MC confronting her about her writings. The fact that she would be so interested in writing about that subject in the first place combined with her reactions to their growing relationship strongly suggest that these ideas are linked and that the core of her conflicting emotions come from her inner conflict upon pursuing a sexual relationship with her father behind everyone's back, even his.
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