The size of the memory card depends very much on if she will have frequent access to a computer to upload the pics. If she does, the 4gb will be more than enough.
The Canon is a good camera, but have a look at last week's Gadget Show. They reviewed simple to use small camcorders that can also take stills. The price was not much different and the photo quality was excellent.
It is more important to buy very good batteries, otherwise they will drain very quickly.
Go to Jessops or similar and have a good look at what is available. I am very grateful for the eye viewfinder on my own camera as the large screen is invisible in bright sunlight. Other cameras may be different.
Also consider those very cheap and easy to use camcorders, such as the Creative Vado. Good fun.