Auschwitz is the German name for the town of Oświęcim in Poland, the location of a Nazi concentration camp in the Second World War. Perhaps as many as 1.5 million people were killed by starvation, gassing and medical experimentation in the camp.
The meaning of the phrase is to say she looked bad - you might say "...if you look like a scarecrow" to mean something similar, and without the risk of offending anyone.
I recommend you don't use the names of concentration camps in this way yourself, but perhaps that's not a strictly linguistic point.