What I love about these discussions is that there are conservatives with reasonable views on both sides. It is one of those issues that does not have a clear plank on the platform we are all 'supposed' to abide by. I can see both sides of this issue, and depending on the circumstance have flip-flopped which side I am on.
I am big into property rights as anyone is when the pestering is silly... but I am also big into people being able to contractually control the world they want to live in by having everyone agree to some guidelines. When situations like this woman arise, where the sin just doesn't seem that bad and the pestering is severe like this seems... (jail time really?) I would take this woman's side, now that I have seen the yard.
If I moved into a historical area because I liked the old feel of it, I certainly wouldn't want my artsy neighbor to tear down that old house and build a blue glass tower. The extreme are towns like Leavenworth, WA where every building, from your storage shed to the grocery store, must be correct Bavarian Architecture. It is a success as a tourist town and has a beautiful and uncommon feel because it is VERY strict. In that case, the entire town has to live by it. Private property or not. And it is gorgeous. Who would argue against their (the town's) right to keep it that way if a Walmart bought property and wanted to build a big square store in the middle of town? - Or a guy wanted to build some other kind of house. I wouldn't. Leavenworth is a known deal when you buy in.