The trek 7.whatever bikes are good bikes, basically all the large companies make similar flat bar bikes and this one seems to fit her. Keep an eye out on her riding in case a shorter stem or one that plus the bars up higher would help her with hand or wrist discomfort.

Good luck, you are being a good brother going to all this effort, I hope she enjoys it. Heavy smoking, that's a tough one, as a non smoker it's hard to relate to reading how incredibly hard it is to quit. I guess all I could hope for her is that slowly she becomes more comfortable on two wheels and hopefully enjoys the physical exercise aspect of it.