In very confusing situation and really need advice on what I should do?

This is going to sound blunt, and I'm sorry for that, but she's not that into you. She knows that you're interested, but she's made no attempts to progress the relationship. She doesn't want a relationship with you and I would suspect that she's subconsciously using you to replace the relationship she lost earlier in the year. My advice would be for you to break away--don't cut her out of your life, but start spending less time with her. Meet someone new. You won't find the one right away, but you may find someone who inspires you to really look. Good luck!