My Dog has a Phantom Pregnancy?

Lola just turned 4 last week (she has the same birthday as I do... Sept 26th). She was in heat a couple of months ago. But just a few days ago.. her behaviour changed.

She has this horse soft toy I got her from Kohepets a long time ago. And she's never really paid much attention to it. But now, she takes it everywhere. And she finds little hiding places for horsie around the house.. like in the corner of the bombshelter, in the sliding cupboard under the guestroom bed.... places she never bothered to go to before.

It's almost like, she thinks Horsie is her baby and she's protecting it all the time. When we take horsie away from her (like to wash in the washing machine and then hang it out to dry)... she gets very agitated... pacing around the house, whimpering. Good thing is, she doesn't growl or get aggressive with us when we touch/take horsie.

She hardly eats her dog food. But other than that she looks okay, and is active throughout the day. 

In bed at night, while we are sleeping, I sometimes wake up just to check on Lola who sleeps next to me most of the night... and I often find her panting. Like breathing very hard. I've googled all these symptoms, and I think it's a false pregnancy! It should pass in a week or so.

David thinks it's so cute, the way she thinks horsie is her baby. But it's really very obsessive the way she is around horsie and also she's never been like this before. I'm worried that she is not well (in the head).

False pregnancies happen to dogs who are not spayed... usually occurs about 12 weeks after heat (I read). It's a hormonal imbalance. I've been considering getting Lola spayed for a couple of years now... but never really got down to it because.... she never had any problems with being in heat, in fact, sometimes we can't even tell she's in heat because she doesn't bleed much, she cleans up after herself so well and she's just an all-round well behaved and sweet dog.

I also worry that spaying her at 4yrs of age... is too late, and that it's more pain for her than benefit? I'm afraid that the trauma from the procedure will change her personality too... she's really just the sweetest dog.

Here's a pic my husband snapped with my phone, last night. LOL. Super unflattering pic of me in glasses, no make up and hair never comb... and chewing a mistrel choc in my mouth. And Lola by my side cuddling both horsie and teddy.

Have you had female dogs go through this false pregnancy thing before? Is it true that once it happens, it will happen every heat cycle? Should I spay her at 4 yrs? Are there really benefits to spaying (like a longer and cancer free life)? What do you think?