Her expectations are £300 Pay Per Meet.
I would see her--for a lower rate. I can't exactly say, "well, you're not as hot IRL as I hoped, would you compromise on price?"
Any ideas for strategy? I feel like it's bad etiquette to haggle, especially at this stage; maybe I should just wish her luck and say goodbye.
Okay, that's a different issue, which requires a different response as you're now effectively asking a different question.
Your first post seemed to suggest you didn't want to see her at all and wanted advice on how to let her down gently, hence Martini's great advice.
If, however, you are actually saying you would be prepared to see her but for less than she is asking, then, while funny, it's obviously probably best not to say "I wouldn't mind fucking you if nothing else is available" and "Blimey! 300? I only give that to models and you're a plain looking older burd!"

Saying she's not what you're looking for is almost certainly not going to get you a discount and is just going to shut down the communication, so just go on your budget line, saying "sorry, you're a nice girl and it would be lovely to meet you, but I'm afraid my maximum is £200 considering I'm also covering other costs including hotel" or similar.
Lots of girls in London quote 300 as their starting price and then come down, particularly if they're not stunners, so I would imagine she would. If she doesn't, then best to walk away.