ATF provider rates as posted in ad for new clients in same area where existing clients resides are 25% less than existing client rates. Should existing clients be upset or is this the norm ?  Does provider risk loosing existing clients ? How should existing clients respond if at all ?

It's def not the norm, in my experiences. Now I have seen ads where the provider says discounts to reviewers, or to TER members, but never specifically for only new clients. It really depends on how she worded it exactly.  
Maybe ask her privately, in person to clarify her position on it over pillow talk? Yes, of course you can be upset over it. That would be a frustrating thing to see, especially if you saw her multiple times as I am guessing you have.
I can certainly understand why a provider would try to increase her client base, but she does run the risk of alienating guys who may have been very loyal to her. Maybe she will handle those on a case by case basis? No way for me to tell. Knowing her personality would be helpful as some ladies you can bring up virtually anything and they dont generally take offense while others are very strict about their rules/regs and dont ever want to be questioned.  
To the the question of how you should respond, it depends how important she is to you and just how annoyed you are. You called her your ATF. Are you willing to risk losing her over this? Tough decision but I could certainly understand if you walked away from her. It just depends on where you live and what other options you have nearby.

The newspaper  
The garbage collector  
The cable company  
Gym Member Shil
And others
Get them to come in and try the service  
What they do not realize this introductory session is not a subscription that collects automatically every month and leaves the existing clients feeling less valued.

If it’s for the first time only, I see no issue. I assume she’s trying to generate new clients hoping to keep them. I have seen it in other businesses. I got a deep tissue massage this past weekend and they offered a cheaper rate for first time clients. The hope is I will like it so much that I will think it’s worth the standard rate. We see promos and free trials in businesses all the time, and these are for new clients.

to reflect her current pricing.

who are seeing her for the first time realize what they are getting.  Those that have been seeing her regularly for a long time have not noticed the changes in age, weight, skin, etc., because those changes have been gradual.  Aging providers have a hard time coming to grips with the reality of aging, but eventually, they must be realistic about how they really look to people other than their friends and family.  This means pricing themselves competitively to attract NEW business.  

CAC, customer acquisition cost, is fairly high in the service industry. That's time and money, and, I'd imagine the play there is to lower the time required to convert via an ad at a fixed additional cost. The gambit is the cost of retaining a customer is lower than the increased cost of acquisition. That is, on the whole, true, but complicated by this being a service and not a consumable.

Existing clients SHOULD be upset and with good reason.

He said that new clients were getting a discount and I took that to me she specifically said that in the ad, but you could be right. Maybe he can clarify.

Not a sound business decision and I'd feel a bit upset as a customer.  

It was over 10 years ago and yes, I was a little miffed.  I don't recall seeing it recently.

The question is, what is the downside to losing her? If she really is his ATF and I take him at his word of course, then why stop seeing her? Out of price envy i.e. jealousy? A sense of unfairness? Both rational reasons actually, but then what happens?  
When you really like and click with someone, one has to really think long and hard about it. But I guess he can also just stop seeing her for now, not telling her the reason as there would be no need, and see how he feels in a few months time. I would strongly suggest he just doesn't burn a bridge with her as sometimes guys do in these situations.

If someone has a hard, strong (insert penis joke here) principle to not pay over x amount of money or don't take rate increases. I can see such a scenario.  

You see this kinda thing from businesses that get people under contract. Satellite TV, phone service, and the like. They run a cut rate special for new customers only and some guy is standing there saying “WTF I’ve paid my bill on time every month for ten years, why’s that guy get a better deal?”  

It's called "Hooker Math."

This strategy is not new.  Many companies offer a new customer discount or incentive.  My former ATF offered it and had it spelled out in her ad.  No need for any returning customers to get bent out shape about it as the provider is attempting to garner new business.  

Yes I’m familiar. Often used to refer to things like 1hour =  X, 1.5hours = 1.25X, 2hours = 2.75X.  Can be applied to this situation as well.  

In marketing terms it’s called a “Honeymoon Rate”.

are sure to get fucked?   Lol

You folks never heard of the Bible's Parable of the Workers?  Everybody got paid effectively at a different rate.  But the lesson was, you got paid what you agreed to.  So shut up.

I think it would be only natural for a guy who say has seen the girl 20 times at a tune of maybe 10-20k over a year or so to be feel disrespected. Not saying that is the case here but the reason it is so uncommon I believe, is that women wouldn’t want to potentially rock the boat with long term fantastic regulars.  
The risk/reward analysis seems skewed toward not doing it. Emphatically skewed at that. Seems like short term gain for long term pain. But then again, none of us know her situation. She is privy to numbers we are not.

True. It’s funny, I was thinking about that while reading the thread as well.