Location of restart after offsides?

Question from a match:

An attacker in an offside position runs onto a through ball played well ahead of her. The attacker covers a significant distance from her initial location when the through ball was played to her final location when she 'plays' (touches) the ball.

From where do I take the restart? a) Her initial offside position when the through pall was played. b) her position when she 'interfered with play' (touched or came onto the ball).

Law 11 is unclear (to me): "If an offside offence occurs, the referee awards an indirect free kick *where the offence occurred*."

I chose a), but got some flack for it (She covered 25+ yards before she ran onto the ball, and I can imagine it looked odd). Thoughts?