Hi Di
I get sooooo irked when schools fight *against* the very students they should be helping
IEP is usually for learning disabilities etc but the 504 covers more of the illness and or emotional issues for which accommodations are needed
My son benefited enormously from the 504 plan accommodations for his Tourette syndrome and after the Crohn's dx, he was able to carry it over to the Florida Virtual school which we were overall very impressed by. It is fully your right to homeschool, especially with the issues you have described
I got a lot of great info from the Tourette Syndrome association re my son's rights within the education system and tho I realize your daughter isnt TS yet you may find some info there
http://www.tsa-usa.org/educ_advoc/education_main.htm
my PM box is open if you have any questions