For starters, there is no such thing as a British Empire anymore. The Commonwealth is just an assosiation of countries, no real power or anything. Even though she is the nominal head of state, she weilds no power whatsoever in Britain, and even less in commonwealth countries, where Governor Generals take over her duties (little more than presiding over parades and giving some feel good speeches).
So why is she still our official head of state? Well, no one really cares enough to do anything about it, since the queen is truly inconsequential.