I definitely think she knew on some level that they were in love. She accepts it, though obviously she's not happy with it, and that's why she tells Ennis about Jack wanting his ashes scattered on Brokeback. Ennis' comment about their time together on the mountain confirmed her suspicions - she had a little moment when she took the comment in and teared up.
Broadway Legend Joined: 5/25/05
My thought was that Jack died exactly as Ennis pictured him dying, and the "tire" story was a cover-up. Whether Lureen knows this is debatable--remember, according to Jack, she had checked out of their marriage, so it's possible she really believes this story (or won't allow herself not to believe it, as someone suggested earlier). Also, it's never made clear whether she suspected the truth about Jack and Ennis. The fact that she tells Ennis to see Jack's folks does imply that she feels some guilt over what happened, despite her detached attitude.
Videos