Update: went out again, same thing happened. NEXT.

Thanks for all the advice!

Update: So she texts me out of the blue after a month of not talking to her, asking why I've disappeared on her? and that she was thinking of me etc. I just replied and told her I've been busy etc. Anyway she says we should do hiking sometime. I played it cool and acted pretty ambivalent, so just replied sure we can do that and she should just let me know when. No reply from her since then.

The way I see it I have 2 option:
1. Play it cool and see what she does.
2. Show active interest and go out with her again and risk the same thing happening as last time.

How should I play this one?

She keeps wanting to hang out; she clearly is into you. This may be your last opportunity with this girl. This would be the third date with her. So think of it in that way: Nothing to lose.

Don't set it up in such a way that you're going for the kiss at the end of the meeting with her.

She's already been to your place. Why not just invite her over to watch a movie. Get comfy, flirt, kino escalate and make the move naturally within that context.

Actually this would be the FOURTH date with her, that means she's already had three chances to show me she's interested. I'm thinking maybe I should let her do the chasing this time around? Don't wanna get friendzoned either.

She is interested or she wouldn't be hanging out. Avoid the 'hero move' at the end of the evening which results in her reflexive rebuff of the kiss. Go in for a makeout sesh while chilling with her, preferably on your own couch.