No reply from PhD supervisor after meeting
Given the initial enthusiasm of the supervisor and the silence since she took my draft should I accept my proposal must be horribly wrong and must be binned. 


No, that's not a reasonable inference.  Students often seem to think that professors use silence as a form of implicit rejection, but I've never actually seen this, and it would be unprofessional in this context.

It's vastly more probable that she has just been too busy to reply, especially if she had planned to write something relatively complex, or hasn't been able to finish reading your proposal.  (And honestly, your initial response about throwing it all out may have complicated it more, since now she probably wants to write something that will not only express her opinion but also reassure you.)  She may also be ill, out of the office, on vacation, traveling to a conference, etc.  July is a major travel period for many professors.

I would suggest that you try to set up a meeting in person, if possible.  It should be much faster for her to reply to that message, since she only needs to check her calendar, rather than trying to articulate in words her response to your proposal.  And having a meeting scheduled will create a deadline for her to have her response ready.  It's best if you suggest a few times when you are available, to minimize the number of back-and-forth emails needed to agree on a time.