Yes, Abby did beat the paladin at arm wrestling, fair and square.

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Transcript:

P1: Abby steps up to the paladin signing, "This is my table!" the slapping it a coupld time for emphasis. "And I'm sitting here," The paladin counters 

P2: "What are you going to do about that?" he asks looking down at Abby. 

P3: "I'll arm wrestle you for it!" she challenges. 

P4-6: The warlock sips from their drink, not noticing Erry until they magically snatch the cup out of their hand, "Hey!" the warlock shouts as their cup drifts away. 

P7: Abby sends the paladin packing, having claimed the table P8: Erry leads the warlock away keeping their cup just out of reach.