Hey morri2,
Sorry to hear about Katie- awful when this happens. Everyone has made very good points, and I would just like to add two things.
Firstly, I took the decision to put my first collie to sleep when she was only 9, this was due to the fact that her back had started to go, and she was effectively being paralysed from her back legs up the way. She was as bright and happy as she always been, and would still love to play with toys like she always did. However, when it got to the point when on a bad day she dragged her back legs behind her, as she didnlt know they weren't working properly, then it was time to say goodbye. Its an awful thing to do, but it is kinder.
However, family friends had a collie which for years (due to an old accident) had not used one of her front legs. She carried it held up, and hopped on her one good front leg. As the damaged leg got worse when she was about 10, they amputated it. I have never see a dog's quality of life improve as much hers did after the amputation. So- just to bear in mind there is a possibility it could help, and she was not a young dog either. It may not be the answer for your Katie.
Thinking of you.
Beth