@phoefling First of all, I think your breeder was incorrect in saying that an xray was not necessary. It could have been a possible fracture. This can be a genetic condition,or just an unlucky pup. I don't believe it is common that they "grow out of it", in fact, if they don't it could be a life of eventually needing surgery, and cause a lot of pain. I believe you need to consult an orthopedic specialist and get his/her opinion on this-bringing the xray with you. Maybe they would just suggest a brace,but that doesn't always work. Your breeder(sounds like-to me) knows that the longer you keep your pup,you will never want to give her up. I don't know your breeder,but since it could possibly be genetic,it sounds suspicious that they said "they have seen this before".
I believe the best thing you can do is see the ortho. and see what the prognosis is. It may not be so bad after all,but it will give you the information you need. Hoping for the best for your pup.(and you).