[Dire]

I strongly prefer a preflop fold in this spot. Against a nit's UTG range, AQ doesn't play much better than any two random cards. I mean you can't be happy if an ace flops and you get any action, and similarly for if a queen flops. And as this hand shows you can't even be happy if an ace AND a queen come down and you're getting action. 150BB just means the decisions are going to be even tougher.

Basically against a nit you're usually going to end up winning/losing a small pot or having to make incredibly difficult and tough decisions like this one.