Ridiculous logic. Lotz still could have been Supergirl. It simply would have been a case of the same actress playing a different role in a shared continuity. it's happened before and it'll happen again. Jason Lee and Ben Affleck each played multiple roles in the shared View Askew Universe (Banky and Brodie in Mallrats and Chasing Amy, etc). Jon Lovitz played three separate roles on Newsradio. Many actors have played many varied roles on Star Trek. It's not a big deal, it's just the same actor playing a new role.
In any event the girl they cast as Supergirl looks good in the role, so it seems they made a great choice, and Lotz is (somehow) going on to a SuperFriends-type show on CW despite the fact that her Canary is dead.

Well, we're both out of luck. They just hired a girl from Glee for the Supergirl role.

I agree that Caity Lotz would make a great Supergirl. However, if the rumours are true that there could be a Supergirl/Arrow/The Flash crossover, logically we can't have Caity Lotz appearing as Supergirl, as she is Sara Lance in the 'Arrow/Flash universe.' I'd definitely support her being cast as Supergirl in a solo Supergirl film however, or if they decide to include the character in any solo Superman film.