I translated as "I saw her looking" and was marked as wrong. I thought the past participle is always singular masculine, but there seems to be an exception. I found the following explanation (in Italian): http://it.answers.yahoo.com/question/index?qid=20111023121705AAV8IUQ
Here's my attempted summary. (Hopefully I understood correctly.) Whenever preceeded by pronouns lo/la/li/le, the participle must agree with the pronoun. However, for mi/ti/ci/vi, the agreement is optional.