OK - finally - things are back to normal and I'm disagreeing with Corri. In spite of everything, I still think that this is good. I don't think it's time to move to the basement. I don't see this as her making a power play and you giving in. I see it as a statement from her of how it is right now and a willingness on your part to accept that for right now.
It's painfully obvious to everybody that sex is far from the only problem in your M at this point. W has issues with XW, with J, with the (not all that) new location, with you, and of course with sex. Right now, sex and the city are the biggest of those. If, as you said in the other thread, you've made conciliatory gestures on helping her to adjust and offering to move if things don’t get better for her within some specified time period, and if you’re willing to temporarily accept her enforced celibacy, it should have two positive effects.
First of all, by ameliorating the two biggest issues on her list, you should increase the peace in the Dog household. Secondly, one would hope that she would notice that you’re making an effort. In theory at least, that should improve her feelings toward you. It may never lead to more (any) sex, but I predict that the R will improve. If the R improves and if she feels like you’re not constantly harping on the sex thing, she may be more willing to address some of the underlying problems that are causing the sex issue to loom so large.
Another thing to consider is that by both your and her own descriptions, she’s a heel-digger. OK, last night she dug hers in. You can now either dig yours in (i.e. move to the basement) and have a heel-digging contest/stand-off, or you can try a different approach. I recommend the other approach. I recommend that you just accept her statement: don’t tell her she’s wrong, don’t argue, and don’t try to dislodge her heels. As was said in another thread: you can always move to the basement later. Accepting her position and not fighting it doesn’t mean that you’re stuck with it forever.