That hen is probably hanging out with my dear rooster "Peeps" RIP good friends!Greetings Hayamz,
I am so sorry for your loss. Like you, many people raise chickens as pets. And like you their pets pass away. Sometimes we know the reason, and sometimes we don't.
It sounds like your hen was suffering from a reproductive problem. Most likely she was an internal layer. This means her eggs were being released inside the body cavity. This is why she was displaying nesting behavior, but not laying any eggs. The internal egg can be absorbed by the body, but eventually, one too many eggs are released, and the body is overwhelmed. The egg will decay within the body cavity creating an infection, egg yolk peritonitis. This will cause a hen to poop a yellow mucousy egg like substance. A hen will have a penguin like stance when they are having difficulty laying an egg, have an oviduct obstruction, or internal eggs in the body cavity. Watery poop, is another way the body tries to rid itself of toxins building from infection. Some hens develop a swollen belly from all the ascites (body liquid), that builds up in the cavity. Along with decreased appetite, a keeper will know something is wrong. Reproductive problems happen in hens.
But, nesting behavior without a egg being laid, is the biggest clue that a hen is in trouble.
Do not blame yourself, these are things that take many years for keepers to learn. I have had chickens for many years. And I still have to take them to the vet for a diagnosis. Because chickens are prey animals, they will hide some symptoms to prevent looking weak. This is how predators find their dinner, sick or old animals are the easiest. Sometimes, hens even recover by themselves.
And other times, a keeper can do everything for a sick chicken, to no avail. The chicken will still succumb to it's illness. I have a hen like that right now. She is my alpha hen, a beautiful black Ameruacana, "Taji". She is on her second course of antibiotics, I have her in the house with me, she has all the love and care I can muster. But, sadly...I don't think it will be enough. I am grieved, every time I lose a member of my flock.
But, this is how life goes.
A wonderful special little hen came into your life just when you needed her.
Now she has moved on to another place. Yes, I believe that all creatures have a spirit, that continues on. Where ever she is, she is not suffering. And she knows how much you loved and cared for her.
These are my thoughts on the passing of your beloved pet friend.
God Bless and peace to you.