American philanthropists Paul and Debbi Brainerd, who own a luxury home near the town, at Wyuna Preserve, have hatched a multimillion dollar plan to overhaul a 3ha site in Glenorchy, creating what is being billed as New Zealand's greenest campground.
The campground would cater for up to 140 guests in cabins, tenting and camper van sites.
Council commissioners approved the development, but Niki Gladding has appealed.
The full time mother, who lives at Campbelltown just outside Glenorchy, appealed on several points, but has now dropped that to one - boundary setbacks from a ''beautification strip''.
Ms Gladding said she was not anti development.
''If they turned around and said the community wanted that, this is actually public land, and we'll move our buildings back 5m, and we'll give the community back control of the plantings and the landscaping of Oban St, then that's fine.''
Mr Brainerd said while his company, Pounamu Holdings, respected the appeal process, it was disappointed the actions of one individual would delay construction.
Most Glenorchy people supported the project, he said.
''It is disappointing to have to respond again to issues that have already been carefully considered and resolved to mutual satisfaction by Queenstown's council, its independent hearing commissioners and ourselves.''
Ms Gladding had a procedural win ahead of next month's hearing - Environment Court judge Jon Jackson agreed a policy about the scale of non residential developments should apply to visitor accommodation projects.
But Judge Jackson called it a ''pyrrhic victory'', as it might not make any difference.
The Brainerds' purchase of a block next to conservation land was retrospectively approved by the Overseas Investment Office in June.
The couple blamed incorrect legal advice for not getting the office's approval in the first place.
