The first thing to do is stop with the flea collars - they are often at the bottom of allergic reactions in animals. I understand she started this problem before you tried the flea collars, but the collars didn't help (they never do. One of the most useless products on the market) - but it could have exacerbated it.
Ringworm is not a worm, it's a fungus and it's always on the outside of the animal (skin). There are actually three forms of ringworm common to both cats and dogs and though most ringworm infections form a circular shaped, hair loss area with scabbing, it can also look like an irregular, raised rash patch. As Dr. John Angus (a veterinary dermatologist at the University of Illinois Teaching Hospital in Urbana) says, "Ringworm can look like anything!"
Cats are the most common source of ringworm in pets; rodents are next and dogs usually pick ringworm up from sticking their noses where they don't belong (rodent holes/burrows). There is also a form of ringworm that's a soil fungus.
Be careful, you can catch it! Though humans have a ringworm that's all their own, it's pretty easy to pick up the pet's version too. Ringworm in humans is often known as ‘Athlete's foot' or ‘Jock itch'.
You can try to treat your pet with the same medication you'd use to treat yourself. Just be sure it says it treats "ringworm" on the label.
If this doesn't begin to resolve the problem in about a week, or if you notice that it's worsening, there are other symptoms such as pain, severe itching, going off their food/water, diarrhea or constipation, etc. - don't take chances - take them to the vet without delay.
Two of the most usual meds veterinary dermatologists recommend are Itraconazole (Sporonox) and Griseofulvin (Fulvicin). Depending on the cat, health history and even age/size, one over the other may be preferred. They are not inexpensive options, both must be given with food (they are oral meds) and absolutely must be continued for the entire length of prescription even if the problem seems resolved earlier.
If the cat has FIV (feline immunodeficiency virus) Griseofulvin should never be used. Also, avoid this med with young cats/kittens or certain breeds such as Persians.
For more options on environmentally treating ringworm and topical treatments, check this link:
It still could be an allergy (as it appears you already suspect) .
Some treatments available for allergies are:
Steroids to help suppress the immune system, reducing the reactions. Treating with steroids is important to follow-up with since side effects may be extreme. Weight gain, increased aggression, thirst/urination and others may be worse than the allergy or asthma. The animal also becomes more susceptible to certain other disease and even seizures.
Immunotherapy is an effective treatment (mostly for allergies), but patience is the key since it may be months or even more than a year before any difference is seen. With immunotherapy, the system is desensitized to the allergen.
Antihistamines block histamines, reducing itching and inflammation. The side effects here include lethargy/sleepiness, sometimes to the point of so little activity that the pet goes off food and may have significantly reduced enthusiasm or pleasures.
Some people and vets prefer to treat the symptoms as they arise. From soothing baths for skin conditions to ointments/lotions. Installing a vaporizer or humidifier in the home to help with breathing is another option (no medications should be used in the vaporizer). Other possibilities may be suggested by your vet.
Start here for sources of financial help - and please persist. The effort is often worth a considerable sum in aid.
Don't forget to call your local Humane Society for guidance as well. If you have a Pet Smart in town, they often have the numbers for rescue organizations that may also help, at least with recommendations for where (or who ) to go.