"You look well" - euphemism for fat?

No. Why would she?

I dont know, Ive never met her. She could be a fragile little soul or she could just be fat and a bit sensitive about her weight?

Not necessarily. What they could mean is "you look well compared with the last time when you looked fat/drunk/ill/disheveled etc"

The best anyone's managed for me is "you don't look as dreadful as you usually do"

One that tickles me is, Wow, you are looking better every day, bet you can't wait for tomorrow.