"The group behind used the tide well and took their chance to catch the chase pack. From there they just out-sprinted her, although the tactics were rough in the final 150 metres.
"She is very upset. Her group had things well under control going into the last lap."
There are also a further five continental places available to complete the field for London, with Baker's 17th placing making her the leading finisher from the Oceania region.
"There are no other swimmers to get to the final qualifier from the Oceania region other than Cara and Charlotte Webby," Rush said.
"We will prepare a case to our selectors to take up with the NZOC, because the spot won't be filled otherwise. Cara certainly swam well enough to prove she can foot it in the field for London."
Taranaki swimmer Webby was positioned in the main pack for the opening two of six laps but dropped off the pace on the fourth lap, eventually finishing 29th to be five minutes behind the winner.
The men's race is tomorrow with Kane Radford (Rotorua) and Jonathan Pullon (Auckland) chasing qualifying places.
Results from the marathon open water swim Olympic qualifier in Portugal today:
Hayley Anderson (USA) 1:44.30.6, 1; Eva Risztov (HUN) 1:44.32.0, 2; Anna Olasz (HUN) 1:44.38.8, 3. Also: Cara Baker (NZL) 1:45.06.1, 17; Charlotte Webby (NZL) 1:49.42.2, 29.