Sadly Wanda this isn't uncommon, and I am so very sorry for you if you have indeed been duped when buying the mare. Did you have her vetted - if so did you have bloods taken, if so doping would show up but as you say you wouldn't want to return her to them it is a moot point really.
Look - take a deep breath, don't give up just yet. Can you find a really good and honest RI to work with you on this? You mention you are in an Island community, so I imagine this isn't straightforward? It might be possible to start right back at square one with this young mare, with very experienced and honest no nonsense input from a very good RI. I won't comment on the NH thing, personally I think this will do nothing but confuse and upset an already stressed and unhappy young horse - but purely my opinion and not everyone will agree with me of course!
Perhaps if you could draw up a plan of action over the summer months, were the RI might take over riding the horse in the short term, and when he/she is confident that you and the horse (or your daughter and the horse) are ready to try and make a go of it the RI will be there with you every step of the way. You could make a silk purse out of a sow's ear, or it might all fail miserably and then you will have to make a decision about the horse's futre. But at least you will have tried and personally I would invest a few more pounds in trying to sort the situation, afterall if you don't - the horse is worthless (even as a broodmare!

)and you have lost the purchase pirce so a bit more investment is a gamble, but in your position I don't feel you have much choice.
Good luck with whatever you decide to do - even the more experienced of us can get it wrong sometimes, so don't feel too bad about it - just look ahead now and don't waste tears over what is done.