You got it.
The basic form of the final clause, in traditional grammar, is:
[SubjectMy eyes] [Verbtraced] [Direct Objecther steps] [prepositional phrase[prepositionwith] [objecta sense of admiring awe].
The prepositional phrase (which has another prepositional phrase 'embedded') modifies the verb traced.
In order to focus on sense as the object of the previous verb retain, we
move the sense &c to the object position ...
I retain yet [the sense of admiring awe]
replace the sense &c with the relative pronoun which (which is therefore now the object of the preposition with), and ‘front’ it ...
which [my eyes traced her steps with.]
then, since with is a true preposition, not a component of a phrasal verb, we move it to its natural position ahead of its object.
with which [my eyes traced her steps]
Note that step 3 can only be carried out with a WH- relative, not with that. The technical term for it is ‘pied piping’, after the old German story of the ‘Pied Piper of Hamelin’, the subject of a charming poem by Robert Browning.