Hi Babybee and welcome to 3FC!
I think you're misunderstanding a little bit about the so-called fat burning zone. We're talking about fat versus carbs as a source of fuel here, not fat versus muscle. At low intensities, you burn a higher percent of fat as fuel but fewer overall calories. At higher intensities, you burn a greater percent of carbs (not muscle) as fuel but a far greater number of calories (including fat calories) overall.
You actually burn the highest percent of fat -- almost 100%! -- while you're flat on your back in bed, but it's hard to argue that it's a great weight loss workout.
The fat-burning zone is a myth that was created by the cardio machine manufacturers who took that bit of science and misapplied it. My NASM personal trainers textbook devoted a whole subsection of the cardio chapter to debunking precisely this issue. But you don't have to believe me (or NASM) -- just google "myth of the fat burning zone" and see what you find.
The way to maintain and build your muscle mass while losing weight is to weight train (lift weights, resistance training). Low intensity cardio exercise won't preserve muscle any better than high intensity, unfortunately.
All the research that's coming out shows that high intensity interval training is the best cardio for fat loss. EPOC (excess post-exercise oxygen consumption) is elevated for a much longer time than after slow, steady state cardio and the studies show a greater fat loss over time.