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Stupid I know but help needed
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            Dragging this back on track for a moment (apologies)...
The copyright violation originally happened when the OP printed her own copy of somebody else's work. Maybe it was just one picture, maybe she found a lot of shots online she liked and offended serially, we just don't know.
She tried to sell it and got caught. She didn't manage to sell it for what she hoped, this does not establish the market value of the IP for the image, though.
Now into some wild speculation...
Had the print sold for say £500, would the OP have printed another copy to sell? How about £250? £100? £50? OP pleads ignorance of copyright law, so we can only assume she thought any image online was hers to use for free as she chose, so she'd be mad not to have printed 50 copies and sell them for £500 each as she believed (wrongly) that she had the right to do so.
Is ignorance an excuse in law? No. Would it affect the judge's attitudes to damages? Who knows? Not selling for £500 or £1.20 doesn't set a value for damages. £350 is not that unreasonable considering iStockPhoto 'Limited Run' licenses for an ~A4 sized print at $580. In fact it's about right.
If the photographer will settle without court, probably OP's best bet as they are legally culpable as far as I can see.0 
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