What does the song "Rains Of Castamere" signify?

The big ploy about this song is that it is associated with the Lannister family line as a whole.

The look of horror that appears on her face is that of dread as the presence of this song means that the Frey's aren't their ally, but actually are with the Lannisters.

As stated and shown, it is truly a trap and one of the most shocking events in the whole book, dubbed The Red Wedding

Taken from the GoT Wiki for a better explanation of the origin of the song:

The Rains of Castamere immortalized the destruction of House Reyne by Tywin Lannister. House Reyne was obliterated after they rebelled against their liege lord, Tytos Lannister, who was perceived as weak by his own vassals. To restore Lannister dominance, Tytos' son, Tywin, marched against the upstart Lord Reyne. By the end of the rebellion, Castamere had been put to the torch and all members of House Reyne executed. The title is thus a play on words, as the "rains" fall over the empty halls of the "Reynes" who have been killed to the last man.

If one remembers, Cersi describes this act to Margaery before Sansa's wedding.