The day before she resigned from the Arizona State Legislature last week, just an hour before she showed up at the Capitol for the second day of her ethics evidentiary hearings, Representative Sue Laybe was picking at a peach cobbler at the Golden Rule Cafe and recalling the afternoon when four police officers arrived at her house in connection with the political scandal that would become known as AzScam.

She remembered that she was standing in the kitchen with two of the officers when she caught sight of the tiny barrel of a rubber-band pistol being aimed at the police by her eight-year-old daughter, Adrian.

"She was going to protect her mom," Laybe said. "And I said, `No, Adrian, the police are our friends. These are not bad men.'" She added, "I still think the police are fine people."

Later in the interview at the Golden Rule, Gary Peter Klahr, Laybe's outspoken attorney, pointed out that Laybe has never hoped to "die rich, like that witch Carolyn Walker." When he said it, Laybe smacked him in the arm.

"Gary, be nice," she said. "I don't like you talking against the other members."

She left the cafe in reasonably good spirits, willing to undergo the ordeal of evidentiary hearings rather than resign because, she said, "I am not afraid of the truth."

Within 24 hours, Laybe had resigned, and had accepted the plea bargain proposed by Deputy County Attorney Myrna Parker. Laybe's political career was over.

Afterward, her voice coming through the telephone was indescribably tired and thick with tears. "I could not afford to fight anymore," she said of the hearings that, only the day before, had not seemed to frighten her. She said that the monetary risk was too great. Sources close to her revealed that Laybe had changed her mind about holding out against charges when Michael Crusa, former aide to Senator Dennis DeConcini, had testified at her hearing the day before. Crusa had downplayed the history of his friendship with Laybe. He'd also said that she'd turned over to him $10,000 of the nearly $25,000 she took from undercover police agent Joseph Stedino, saying that she needed him to funnel it through the national Democratic party to create an "alibi" for her.

The word "alibi" was damaging since it seemed to communicate that Laybe knew she had broken the law and scurried to cover her tracks as news of AzScam began to fill the newspapers.

Insiders said that Laybe denies having ever used the word "alibi," but that--more important--she had considered Crusa an intimate and felt he had lied about her and then abandoned her. For Laybe, who is characterized by those who know her well as "loyal to a fault," the blow was devastating, and she felt her fate was sealed. "Who would you believe in this situation--Mike Crusa or Sue Laybe?" asked a source.

Her reactions to the tornado ripping through her life--her faith in the police department that engineered her fall, her lack of cynicism about her peers, her ability to be wounded by someone she considered her friend who was, after all, only a politician--were not those of a hardened officeholder, and that is the truth about her. Laybe never ran for public office before 1988, and she spent her entire life before the legislature in what she always refers to as the "hospitality industry," which means that she was a waitress and a bartender.

She is an average woman, a wage earner, who has perhaps been most remarked upon at the statehouse on the basis of her unfortunate wardrobe.

"The House is run by a rich doctor's wife [Speaker Jane Hull], and a lot of the Republican women are always showing off their clothes," says Representative Peter Goudinoff. "There was cattiness about Sue. She wore simple cotton dresses, she smoked, she had been a carhop. If we were English, the social discrimination would have been easier to understand."

But if her appearance is unimpressive, the story of her election is positively inspiring. It was Laybe who, for the first time among Arizona politicians, milked the voting influence of the gay constituency in such a high-spirited way that she became, according to one insider, "the darling of the gay club circuit." Laybe found an untapped source of power and entered the political arena against all odds.

And if she seems to be just a dishonest dupe these days--someone shady but naive who was brought justly to her knees by the righteous agencies of law enforcement--behind the scenes of her public dishonor, her colleagues are clamoring about the motives of the County Attorney's Office and police department as they engineered the "sting."

Such concerns are no longer unusual. As the shock of the AzScam videotapes wears off, more and more insiders realize that by releasing to the public the graphic images of legislators stuffing payoffs into gym bags and, in Laybe's case, shuffling expertly through stacks of bills, the police department distracted everyone from concerns about how the "sting" was conducted. Memories of other police department investigations during the Eighties, when the members of police and firefighters unions who were targeted turned out to be critics of Police Chief Ruben Ortega, are flooding into the minds of those close to this investigation who think they may have something to fear.