Wow Carbo, I should checked back here earlier, I would have liked to respond back before the argument began branching so much as it has.
First off, I agree exactly with what "kranky" had to say on a method of discipline. I think he laid it out perfectly. He referred back to what I mentioned about questioning her to make her think.
Second, I know you hate the idea that she wants to be a singer/actor but a lot of young girls dream about this. The best thing you can do, is take her up on it. Get her singing lessons, acting lessons, make her dream a reality and see if she has what it takes. If she wants to be a singer and you take her to singing lessons and she sucks (no offense of course), it may shed some reality in her world. She will realize that she can't rely on her singing, as she isn't very good at it. My parents did this with my sister, although they did it a little too late, it was still very affective. She realized all the work involved and all the changes she had to make, and gave up on it. This may backfire and she may be a damn good singer / actor... but just imagine how fast you can get her out of the house then 

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Third, a lot of people suggest turning her in or reprimanding her very harshly. Think about the reality of this situation. You want her to realize that cheating is bad with the least ammount of permanent damage as possible - that should be your objective. Scarring her academic record and possibly her entire life may not be the best choice. Granted, it is still a choice and probably a good choice, but I wouldn't consider it the best choice. It is like choosing to run your head through a door because you found it was locked - sure you may break the door down, but how much damage have you done in the process? This is why I would urge you to consider Kranky's suggestion a lot more first. I especially like the part of his suggestion where you ask her what she thinks her punishment should be, because it gives YOU feedback on her thought process.  
And, since this is junior high, it will get worse. My entire High School cheated, thats how it was. We were all given 7 hours of homework a night and, being the intelligent human beings we were, we realized the only intelligent solution was to split the homework up between people to cut up the man hours. I do not regret this at all, because it allowed me to live my life as well as go to school, 2 things I consider equally important. It also taught me some great teamwork skills.