Since there, according to the court clerk's office, is a judgment entered against you in 2004, I would go to the court and pull the entire case file and copy it. Somehow, I doubt that this is the case, if the term "dismissed" is accurate. If the record says the "judgment" was dismissed, I bet she meant that the plaintiff dismissed the case without prejudice OR the court dismissed the case for lack of prosecution. Therefore, in this case, it could well be a new lawsuit.
If there is a judgment, it would have been discharged if paid off (which, from what you tell us, it would not have been), or vacated if it were cancelled. Both require that the debtor know about the judgment since the debtor has to actively deal with this. Also, if there were a judgment, it's likely you would have noticed a withdrawal you never expected from your bank account...even if that were the first you heard of it. That, apparently, did not happen--yet. Maybe this paper was the notice of such a garnishment. Another unanswered question that going to the court will answer.
I suspect it's even worse: They did get a judgment. If so, it's likely that "piece of paper/letter" that the nice Deputy served to mama in your stead was likely a summons for a debtor's exam (information subpoena);a mere collection letter, even for a client who is collecting on a judgment, would NOT be served by an officer of the court/process server! If that judgment is out there, and you were served a summons for an IS, you had better show up for that or be found in contempt of court.
In other words, you had better make sure of the true status of any case before you decide to talk with Discover about settlement. It may, indeed be a new case, in which case you need to answer the complaint. (SOL will be tolled (stopped) as of the filing date so waiting it out won't work.) Going to the court and checking out the files will confirm this...and the plaintiff you need to deal with.
Also, is the CA really working for Discover, or did Discover sell the judgment to a JDB? Contact Discover, and ask about your account. If they tell you they don't have the record, they likely sold it. Ditto if they tell you that they did sell it. In that case, get the contact information of the buyer, because you will need to settle with them; if there is a judgment, you will have to pay it somehow, and you have to negotiate with the current holder of the judgment to do that.
A critical note: If Discover has gotten a judgment, and sold it to someone else, the court will need to have a record of the judgment having been transferred to the new holder. If the new holder did not get the judgment transferred to them and have it recorded in the court records, they likely have no right to enforce it until they do! So, this is another possibility--this is notice of a court hearing related to this transfer, although I would not think that your presence would actually be needed, and this would simply serve as notification that there is a new judgment creditor.
This last case would also create a legitimate delay during which time you can hopefully stipulate a settlement with whomever owns the debt now if it (such judgment) cannot be vacated.