Tell her to go for it, thats an awesome price. My dad used to have a 525i, it has some decent power, its geared mostly for the highway though, so there won't be a huge amount of power until you get going at the higher speeds. A performance chip improves things a lot though. You can get reset tools, I've seen them in the BMW catalog I get (Bavarian something or other..)
I saw a newer M3 in a parking lot today, those are pretty nice also. I've seen a 98 sedan for $28,000, in upstate NY.