i think you should give it another go, but keep your eyes wide open like everyone's saying. you say she did confess to you, and it wasnt you catching her cheating right? that counts for something. it was one time, right? that counts for something, its not like a pattern of behavior. just know that it could happen again, and take things slow. also, when the time is right, i would let her know on no uncertain terms that you are going to need to take this slow because of what went down before. she has got to be able to understand and respect that. but once you talk about it and get it out in the open. dont ever bring it up again (the cheating part, the taking things slow part is still fair game) dont "make her pay" by bringing it up all the time like some "get out of jail free card" you can use to your advantage in arguments, etc.
the most important reason you should do it:
when you look back at your life, do you really want to say to yourself, gosh what might have been if i wasnt too scared. at the very least, things wont work out and then you can close that chapter of your life and you'll have peace of mind knowing that hey, you did all you could do, if it didnt work out, its on her.
one rule i live my life by:
fear is not my master. fear will never tell me what i will and will not do.
now that doesnt mean to be naive, mind you, but i think you know what i mean.