Trainer Linda Avery was pictured running around the ring at the world-famous contest.
She was later filmed at another show lifting dogs as she prepared them for competition, a court heard.
Avery, 57, started claiming the highest rate of disability benefit in 2014. Over the next two years she pocketed £12,000.
Judge Paul Darlow told Plymouth crown court: “Her condition has improved enough to be seen running dogs around rings at Crufts. It is one hell of a recovery.”
A probe was launched after Avery, who lives in the city, posted a picture on Facebook of her showing a dog at Crufts.
Investigators also filmed her exhibiting a pet at a show in Paignton, Devon.
The court heard Avery, who uses a stick, was still on benefits. Ali Rafati, defending, said: “She failed to notify improvements in her health.
“That resulted in her receiving the higher benefit to which she would not have been entitled.”
Avery admitted failing to tell officials about her improved circumstances.
She was bailed until sentencing on March 8.
The court was told the authorities would take legal action to recover the cash through the Proceeds of Crime Act.
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