I'm not surprised--stuff that should be kept under wraps gets out all the time, and you'd be surprised how many people know your business. That said, I don't agree with the people who said that one person cannot "axe" a PNM all by herself. Yes, one person can. It didn't happen to me, thank goodness (not to my knowledge, anyway!), but I know whereof I speak because the people in my chapter have virtually no say in who gets invited back. That's up to the rush committee, headed by the rush chair, and if one of those people on that committee did not like a particular girl (even if she got truckloads of green cards) I'd be willing to be money she would not be on the list of those invited back. If the rush chair in this case really is such a bitchy character, maybe people were afraid of her and didn't challenge her for that reason...hell, I'm not sure I'd want to get on her wrong side either, even if I was an initiated sister!
I'm really sorry this happened and quite frankly, I think it's ridiculous, but I cannot say I'm all that surprised. It happens all the time, not just in sororities but everywhere. It would be nice if there was a way you could sue or something!

Seriously, though, it was probably a good thing that you ended up a Kappa because at the end of the day, at least you know all those girls respected you and didn't treat you unfairly.