It's also worth remembering that she apparently dated Damon for years, but our flashbacks imply they never had sex (for obvious reasons).
So she's basically been in a long-term relationship where her boyfriend refused to have sex, while the entire time their friends were apparently having sex constantly. So she's built up the idea of sex with Damon into a huge thing in her head, and it's tied to her own feelings of validation (Damon constantly refusing her probably made her feel kind of worthless, which is only part of the psychological damage he's been doing to her by using her as a convenient beard).
When she has sex with the MC, the combination of her growing feelings for him being a very new thing, combined with years of pent-up frustration and angst (and possibly even guilt, if she feels like she's "cheating" on Damon to some degree), leaves her feeling emotionally confused. And then bam.
The realistic outcome of that whole mess is that either the MC decides he's had enough and rejects her over it (like many players seem to be doing in this thread), or they both realize the root cause of her issues and start working through them (meaning she needs to accept the idea that she'd rather be with MC and not Damon, and that it was never her fault that Damon was playing games with her emotions).
Again, characters coming to terms with past relationships and learning to let the past go is pretty much the theme of this game. The various LIs are basically going through the exact same voyage of discovery the MC is. Almost every romance path is essentially two broken people learning how to fix themselves by learning to care for each other.
