mazca, in my opinion there is no element of “being a fool” in this case, because a favorable judgement only changes how one views the elderly woman (assuming estherh does not encounter her again). But in general, I don’t think judging favorably requires one to expose himself repeatedly to negative situations, especially if someone feels threatened physically/ emotionally/ mentally.
I remember learning a vort on the words “Tamim Tiheya in HaShem Elokecha”, you should be “simple” with Hashem–this means that one should be trusting with Hashem, with simple, unquestioning emuna. The vort I heard in the name of one gadol is that this is telling us that we display this simple emuna towards Hashem, but not towards other people. If I recall correctly, this vort is from the Chafetz Chaim. It seems to me that there’s a powerful lesson to learn here: even the Chofetz Chaim, who epitomized ahavas yisrael, believes that we should recognize that other people aren’t perfect, and protect ourselves as necessary.