She will of been made homeless!!! She needs to ensure she can prove this at the council so her application gets deemed as priority. She needs to go to the council as every council is different and get their advice if she feels that they was unhelpful then tell her to ring she needs to know what she can do as waitting lists can be months to years.
As for the house she will have no chance, if it is a council property they are dealing with and then will follow the policys of who is priorty on their list, if they did not do this then that would be unfair and everyone would be looking for empty house's who are on the list.