Am I crazy for thinking Madomom must have an inkling of what's really going on here? this line in particular seems to imply that she knows who Kyubey is.
Was she also approached by Kyubey as a girl and declined to make a contract with him, or something? Maybe she just wrote it off as a childhood fantasy and Madoka is making her wonder whether it really happened after all? I dunno. I don't know how else to explain why she just lets Madoka go here.
Or maybe it's just Madoka from an alternate world line, who has grown up, gone back in time, had sex with her father, only to give birth to herself!