Is is just letting me down easy?

no i dont think she was letting you down easy because she did just lose her dad dude. ask her if you can help her in any way, just dont be a pillow to cry, this is important dont be that guy she crys to. dont be that gay friend every girl has. just try to be supportive for her and try to help her out of her rut. then when she good try to go for it again. if anything you will have a great friend. every relationship you put energy into you will get something good in return