By dealing with Semirhage the way he did, Jordan attacked not her source of brute power, but her mystique - unarguably the most potent weapon she possessed. And in this arena, Semirhage was soundly defeated. It wasn't the mere 'lessening' of a great character... that spanking scene was actually her true defeat. The point where she (once freed) was balefired by Rand was almost incidental to her falling... at that point in time, her real power was already broken, she doubted herself (knowing her failure, as we saw when Shaidar Haran visited her), and causing her to act from weakness rather than strength.