No the "this far" is pretty obviously Margaret saying Liz was never a challenge for her to beat. And considering you get your whole party for Margaret, but have to solo Liz I believe her.
And I consider it less Liz got stronger and more the fact that Wild Card is much stronger with Bonds and friends. I believe when you play her story in Arena, at the very end the IT scare the hell out of Liz with the power of friendship.
"We have choices. Some people like to stand in the rain without an umbrella. That's what it means to live free."
I have a theory the Margaret was subconsciously holding back against the main character and his team well at first anyway also they weren't trying to kill you they were looking for their "Answer"(I know it's a bad pun but I couldn't resist it.) both Margaret and Elizabeth could easily one-shot you otherwise.