Free-thrower positioned extreme right

[River Ref]

Girls JV game and foul on a shooter. Line up for 2 shots and ready to administer the ball when shooter A1 takes 2 steps to her right and positioned only one foot from defensive player. I had never seen this before,but by rule I thought it was all legal. Defensive girl B1 looks at the free-thrower and then to me with a "what the" look.I steped in and advised the defender that for sure let's not have any contact. I was hoping to cover my butt,because I was not certain of how to handle a foul on a free-thrower. A1 shot right handed and was 6 of 6 for the night so to her credit it works for her.
During a time-out coach complains that the shooter is taking his defender out of the game by being so close. I could only respond that I thought it was all legal. Anyone with a similar experience or just expand on the possibilities?