Her mom handled it right by listening to her, talking with her and encouraging her to do what she wants, no matter what others say.
However, I can't help feeling a little less sympathetic toward the mom because she blogged about her child's extremely common problem at school and seemingly made it much more than it was. The type of pressure to fit in that Katie felt is something that almost every second-grader goes through. Applying the "bullying" label to it is making it out to be much more than it is. All kids want to fit in. All kids notice differences in people and other kids. Pretty much all kids don't have the ability to articulate these feelings. This is what happened.
Like I said, the mom handled it right by listening to her daughter and encouraging her. That's all that needed to be done. Bleating online that her child was possibly "bullied" is just sensationalizing it.