As for "dangerous" that doesn't matter. Most of the serious injuries in equestrian sports (of all kinds) involve horses that are NOT "dangerous." The packer that stumbles in front of a 2' jump can cause as much havoc as a rodeo bronc and very talented and capable riders get hurt badly falling off horses that are not dangerous but that did something unpredictable or because of the timing of a fall. (I busted my tailbone because the horse I came off of bucked right beside the wall. Had the buck occurred 3 feet away from the wall, I'd have landed on the soft foting, instead, I hit the top of the kick panel just where it joined one of the uprights. Bad timing.)
I also want to add to this comment; Dangerous is relative. What we do is dangerous. I ride for a living. Friday I went on a ride on my filly where the wheels pactically fell off the wagon, I was good, didn't fall and we settled in.
Last year, I was HACKING my dependable horse during a lesson that I was teaching, and demonstrating a simple thing in the posting trot on a circle to my students, my broke horse spooked, then bucked; and I hit the ground really hard, actually cracked my CO helmet, When I contacted CO, the people shared with me that most of the helmet returns they get back are from non-threatening events, like cooling out.
I think you should follow your gut, and do what is right for you. I don't do rank for free, and the rankier it is, the more it costs, and when it is super rank; my buddy the cowboy comes over to play, and you pay double, because we take turns!
I have highlighted the two most important things you have written. There is a difference between having the ability to ride sensitive/hot horses and the ability to ride very naught horses. If I were you , I would be honest with yourself and the owner and make the decision that this is not the right fit for either of you. If you are afraid (even a little bit) you will not, when its most important, be able to have that go for broke come to jesus meeting it sounds like this pony is going to need. You run the risk of getting hurt or shattering your declining confidence. There will be another horse to ride, don't feel like this is your only chance to ride.
Moreover, it sounds like the owner is asking you to solve her problem. She may need to pay someone to do that. Trust me when I tell you , the older you get the more fleeting confidence can become. I no longer ride problem horses because Ijust don't have it in me to be a stunt jockey any more. It makes me sad that part of me is gone, but it is and I need to be honest about it.
Good luck with whatever you decide to do.
^^^^THIS listen to your gut!
Life is hard. After all, it kills you. - K. Hepburn