Second, even if she were otherwise entitled to those protections, O.R.S. 44.530(3)specifically provides that "[t]he provisions of O.R.S. 44.520(1) do not apply with respect to the content or source of allegedly defamatory information, in [a] civil action for defamation wherein the defendant asserts a defense based on the content or source of such information." Because this case is a civil action for defamation, defendant cannot rely on the media shield law.
This changes things somewhat. The article says "she's entitled to those protections." This says, even if she were, here's why it doesn't apply.
NB: I think the settlement sucks, but that doesn't mean the judge was the complete idiot the article made him out to be.