Lydia was captured by bandits and I had the ransom note. However it didn't need me to get her as she reappeared in the house and the quest was over.
However she is acting as if she has been traumatised by the event. She walks backwards, can't stand still and is acting in a very strange way!
Is this normal or just a bug in my game?
Thanks in advance!

Just dismiss her, and after go to Whiterun (at Dragonsreach), and recruit her back.

I would except she's my wife!

classic Hearthfire issue. Your wife does that after being kidnapped.

Some people have reported hitting the spouse solved the problem. Like punch her, and make sure your not wearing something that kills her in one blow lol. Or since you can take her as a follower, fast travel to somewhere like a forsworn camp and let them hit her and see what happens.

The whole "kidnap your spouse" thing with Hearthfire is dumb since 99% of all spouses will somehow manage to free themselves and return home anyway... and then all walk backwards in strange circles.

Took her as a follower...haven't hit her or let her be hit yet but will give it a try. Thanks.