We were fighting our way into Fornost working on several other quests when we stumbled across Sara and tried to free her. We had to kill one guard outside her pen in order to open the door to reach her.
What we didn't realise was that she starts by opening up all the other pens searching for other prisoners. And she found some; a bunch of dwarves I think it was, though things happened fast after that. It looked like she was leading them toward the exit of the instance, and along the way they encountered some respawned orcs and began fighting them. So we dove in to help them fight, but then I noticed Sara's morale dropping like a stone. Apparently while the dwarves were fighting that batch, she had headed off to yet another pen and was being beaten up by the orcs and wargs she found there. I called out to the party and headed for her but it was too late, and we failed.
We spent quite a bit longer exploring the instance but she never reappeared. I hope she'll be back if we enter a fresh instance, so we can give this another try.