Hi Karen!
I think you’re doing the right thing in terms of being cautious, as turning her head at this stage could get her too inclined to look away, and ultimately, become too wide. From what you’ve written I think I would focus on doing this, https://macraeway.com/academy/sheepdog-training/figure-8s-in-the-round-pen/, with you walking backwards. That way, when you turn the corner, she’ll need to flank to get to balance point, and it will encourage her to stop looking at the sheep naturally (by virtue of needing to flank). Additionally, it will get her on her sides. I wouldnt do anything to correct her shape on the outrun at this stage and Id do the exercise before trying an outrun (to see if that frees her up). Also, Id minimize her opportunities to stalk the sheep, meaning creep up on them without command. Absolutely happy to set up a virtual lesson and you can read about those here,https://macraeway.com/online-lessons-with-your-dog/, hope that helps. cheers,
Online Sheepdog Training