I have a feeling that the entire conversation was played out for any listening devices Katrina may have planted in the restaurant.
Lois would never, ever endanger anyone who keeps her husband safe from harm. Babs' inner monologue I attribute to residual Bat-paranoia plus the fact that she's still reeling from the double whammy of being taken over by Spy Smasher's operation and Dinah leaving her the team.