Thank you everyone for your time and assistance. Very much appreciated!!!

I managed to get the cassette and bike running again. And I am not sure what I did to fix things up.

I took the cassette apart when I arrived home from work and put it back together again. I rechecked everything, including how the two spacers were on the freehub. Thanks to my neighbour, I took a look at his 10 speed setup and determined the two spacers need to go notched spacer, then smooth spacer. After that I slid the cassette on, tightened everything up, and put the wheel back on the bike.

Everything seems to be rolling smoothly now. Gears are changing and the chain sits nicely in the rear cog.

My wife is taking her bike out for a spin after work today, so I'll get an updated field report then. Thank you once again. If she has issues, I'll be sure to report back.