It is a huge tradition in Texas. I don't know about the rest of the Southern states. I don't know when it began, but over the years they have gotten larger. Thank goodness you did not say anything negative about it, she would have been crushed. Anyone who is anyone has them. Typically, the girl's date buys it for her. If no date, the parents do. The girl in turn buys a smaller mum corsage for the boy that is on a garter worn on his arm.
I still have all of my mums from jr. high and high school hanging on the wall in my parents' house (that's a whole other story about my "time locked" bedroom, I graduated 23 years ago!). When I was a girl, the different streamers had glitter/glitter stickers with your name, your date's name, your grade (fresh, soph, jr., sr.), your activity (i.e. I was in band and flag corps so I had that on there), and the year. You also hung trinkets from it such as plastic musical instruments, a cow bell, jingle bells, football helmets, etc.
I used to always get my younger sister a small version of mine to wear. She was in hog heaven since it was such a status symbol and none of her friends sisters got them one.
Funny Story...
I remember when I was in college 3 friends came home with me one weekend. On the way there we stopped for dinner in this small town and kids there had on mums. I didn't think anything about it knowing it meant it was homecoming there. My 3 friends (from Iowa, Michigan, and NY) almost had a fit asking what those hideous things were. They were appalled to say the least. I had to explain to them their significance. Then when we got to my parents, we had a "special viewing" of mine.
I think that it is truly a Texas (or Southern) thing and you don't mess with our traditions or Friday night football! lol