People may disagree, but just be honest (not about the being bad in bed thing)...just say that you think shes cool (even if you don't) and that you're just not looking for anything serious and since you guys are friends it's probably best you don't want to carry on as anything more.
I've had similar situations, and if you just be honest, get it out there, she may get a bit pissed etc, but from then on wards she knows whats what and things will either get less awkward around her or she'll just avoid you and thus the problem goes away anyways

But I've been surprised at how just laying it straight with a girl can help smooth things out.