In many areas a special needs child regardless of age counts as one of the under 2 (ie infant) spaces when working with licensed care and that could be a problem too in that she found this out after she went with the agency - possibly on the first home visit where the agency supervisor saw all of the private children she had too. In other words she was grateful for you giving her the out to terminate your son. The accommodations you were asking for were not that dramatic. Also being 9 he will be back in school any day now so that will take more of the pressure off her so assuming there were other issues at stake here.

Glad things are working out for you in making alternate arrangements that suit your family better.