I don't understand your breeder's rationale at all. The health contract and the spaying procedure are two separate things, and I don't see how/why she is tying them together. Also, I'm curious if your breeder knows a vet who would perform the procedure the way she wants? If so, maybe you could talk to that person just to see what he/she has to say. I lost a pet to anesthesia during a routine dental procedure, but it had nothing to do with pre- or post-op sedation. It was the actual breathing tube that killed my cat because the tech accidentally ruptured my kitty's trachea with it. So obviously, I'm not a big fan of general anesthesia on a cat, but it seems like it would be absolutely necessary for a hysterectomy! (which is what spaying amounts to). If I were in your situation, I would talk to whatever vet your breeder can produce (if she can), then unless you were 100% convinced by this vet, go back to your own vet and discuss with them what their complete procedure is, and who is going to do it - i.e. licensed vet tech, the actual vet, or other staff member. The last thing I would worry about is the health contract.
Hope that helps!