Long story short I'm an orange hat (instructor in training) working on getting my full instructor qualification. Wife has a really nice 10-22 that has timmwny trigger, tactical solutions barrel, magpul stock, nice Nikon 2-7 scope, all adjusted for her. Perfect. We go to a two day event, she has a blast say one goes from 110's to 179(yeah I am danm proud of her doing that) . Second day pouring rain temps in 40's. Wind. Rotten, she almost cleans the red coat target on intro, then does her first AQT of the day. 175, ok one of the other instructors starts one on one coaching (pet peeve of hers is that I'm a bad coach if I'm emotional invested in her success, I get really worked up and she feels bad if she doesn't make it), second AQT she gets a great score for first 3 stages and prone she misses ALL of the bottom row, mini shotgun pattern about 2-4 INCHES high, every one, but side ways dispersion is about 1.5 inches (from 2 TOUCHING in Prior stages). Says her ammo might be wet (ok but inside of box is dry, we secure her new ammo and she reahoots (stage 4 up this time) groups are roughly 1.5 inches  wide and 2-4 inchs high, went from 3moa shooter to a 6-7 . Fundamentals are all still good. She is frustrated, Cold(all of us were cold), and sits out the last AQT.  Get home and clean her rifle notice that barrel has funny light reflection in one spot on outside(7-8 inches from chamber), feel carefully, yep bulged, take out of receiver and distinct line inside 7-8 inches down inside.  

So that Rifle was fired  with a squib stuck in it,; just not sure if I stress how bad it could have been , or stress the fun and not really sweat the barrel.
She is a somewhat reluctant shooter, but is building up a love for it(probably helped by me buying all the greatest toys to make it better( toe warmers, fancy shootignmats, stocks actually for her) and I don't want to scare her. Attached File
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Hell no, don't tell her for a couple of years!

This. Just tell her you found a flaw in the barrel and thus why her shooting went to shit. Nothing she did.

Too late, she saw parts of receiver on bench and saw the removed barrel. She knew that wasn't part of regular cleaning. So new barrel ordered, and she helped pick it out.  Tax sol 12 inch barrel with suppressor cage (adds up to 16.5 inches) gets here in 5 days. She is pretty content that it was an ammo issue (federal auto match lot number 1gk266) . She is ok with blaming ammo, and me telling her .22 ammo is unlikely to fully rupture barrel really helped.

I have built many 10/22's
Why did you not use a Kidd Barrel? Even the ultralight is excellent.
Then find which standard velocity ammo works well with it...Eley, Lapua, Wolf Match, CCI Standard etc
What is the trigger pull on the timney?

I really like the tac sol super short barrel with suppressor cage as it should move the CG backward which wife will like(perceived weight is far more important than actual weight), also I didn't honestly think about KIDD, though 20 ounces vs 13.5 is a big difference. I think the timeny is about 2 lbs single stage, I don't have a scale. VERY crisp as for the release and almost zero over travel(compared to the stock trigger it is night and day). Also have the volksquarten derlin bolt buffer part so it is WAY quieter. Why Ruger doesn't put those in at the factory is beyond me.

Some friends of mine were shooting a heavy barrel rimfire match rifle in the rain and it started shooting like hell.

after messing around several days later it was determined the rifle had a bulge in the barrel near the end.

Someone they contacted theorised that a drop of water entered the barrel and acted as a bore obstruction.

Wouldn't think rim fire ammo (std velocity march stuff) would have the power to bulge a very heavy match barrel that was 1 1/8"DIA

In the end they cut 3 " or so off the end and re-crowned and it shoots fine now

It was raining, but no way to for sure tell, barrel is with build with a protector on  the threaded end so water would have to hit exactly where the opening was to do that(and even then it wouldn't be 7 inches or so down the barrel, it would be at the muzzle). As for bulging i have attached some photos in the OP.

I would be straight up honest, in a 22 it would be easy to not feel a squib, especially in the heat of competition/training at an event.  Plus she needs to know what happened and the inherit dangers for future squibs when shooting, sure she might be mad about the match results and she can still blame that on the ammo technically.  Never hide or lie when it comes to peoples safety, and that goes x infinity when its your family.  We all have to learn somehow.

Also would like to add wish my wife was more into my hobbies!

My apologies in advance if I read this out of context somehow, but the replies threw me into safety nazi mode Happy shooting!