I played the other day with a very experienced player who held the 2(same) of the 1 tile that I needed to go win - she stated based upon where she knew I was playing, she was declaring my hand dead and that I would need to sit out the rest of the game and then pay whoever wins. Upon reading the info here, am I wrong, but, shouldn't I have been able to continue to play in the event that I would have thrown a tile someone else might me wanting. If she had thrown the tile I needed, she would have paid $1.60 to me. If my hand is dead because she didn't want to throw the needed tile, then wouldn't her hand be dead and she unable to play too? Very confused on this rule.
I'll be assuming you're playing Riichi, that's the only ruleset I know which has "dead hands".
If I understand your question correctly, I don't see why she would declare your hand dead at all in this situation. I take it you declared Riichi in that game. If she called you dead because you could not win, since she kept your winning tiles, that is not a valid action for several reasons:
Maybe there was a misunderstanding and she meant to say "you can't win anymore"?