Is this suppose to happen? is she really this op? the witch you meet in darklight fort who becomes your buddy after helping her. She always use it to paralyze a enemy in every battle and than just spam regular magic on the other.

Actually I have not seem any NPC use that spell before. If what you say is true, it must be a recent addition.

Alternatively, she picked up a staff of paralyze without you noticing. This seems a more reasonable explaination

Yeah I don't recall seeing any NPC using paralyze. There are staves floating around. Are you using a follower mod on PC?

I've got a 74 mage and I only just discovered Illia's tower and helped her with her quest. All I did was paralyze and either frenzy or incinerate the enemies. She just used that CO2 fire extinguisher spell, a frostbolt spell and a dagger. Frankly, I'm more impressed by those arch (fill in the blank)s that I come across in my travels. Those guys really mix it up.