Coates returned to OVW, albeit not under a WWE developmental contract. Upon re-debuting, she soon began facing off with several of the OVW Divas, including Beth Phoenix, Mickie James, Melina Perez. Coates later turned heel and began managing the OVW Southern Tag Team Champions Blonde Bombers (Tank and Chad Toland), as well as becoming Jillian Hall's bodyguard and went on a spree of blinding people with rubbing alcohol in storyline. After training in OVW, Coates then moved over to Deep South Wrestling and debuted for the territory as The Bag Lady, a homeless woman who became the love interest and eventually the valet of The Freakin' Deacon. On February 22, 2007, the Bag Lady debuted a new Diva-esque look and defeated Angel Williams in their subsequent match. The Bag Lady then began feuding with both Williams and Krissy Vaine. On the April 5 episode of "DSW TV Tapings", The Bag Lady accompanied Nattie Neidhart to the ring where she lost to Krissy Vaine after the distraction by Williams followed by Vaine using the heel of a shoe.