I'm with the others in thinking that you'd be better served spending the money on lenses and other gear rather than a new body or buying a t2i instead of a 7D. I've got a 7D and I like it a lot, but the performance advantage over a t2i isn't that great. The difference in glass quality will be greater.
That said, the most general purpose lens is probably the 18-200. The image quality isn't the best, but the range is incredible. As a serious photographer (OK, I'm not really very serious), I'm not sure it's the lens I'd want, though. If you can narrow down your shooting style, you can get a specialized lens that significantly outperforms the 18-200. It just won't have the versatility.
The 70-200 f/4 is already a great portrait lens. It'd be nice to have something in that range that is faster (lower f-stop number) so that you can get shallower DOF (really sharp subject with everything else burry). I think that the 85mm f/1.8 would be a great lens for close-up portraits. It would really compliment that the 50mm f/1.8.
The 100mm f/2.8 macro is a reasonably nice portrait lens and also gives you the ability to do macro. If macro was important, I'd get it. It's not as good for portrait work as the 85mm f/1.8, though, so macro would have to be pretty important before I recommended it.
I've not used the 100mm f/2, but I would think it would be another good portrait lens. It's not nearly as popular as the 85mm f/1.8, so I'm guessing that the latter is probalby better.
As for studio lights, you need to pick one of two directions. You can use speedlights (flashes) and control them from the camera. You could also by dedicated studio lights. The dedicate lights are cheaper, take less time to recharge between shots, and don't need batteries. You can also use modeling lights, which give you some idea of how the light will look, which is very helpful when you are learning. The speedlights are much easier to take on locations or to use when you don't have a place to plug in. They are also easier to control from the camera. If she wants to always shoot in a studio setting (like a big room or your garage), I'd go with the studio lights. If she wants to shoot on locations, I'd go with the speedlights.
For the studio lights, it's hard to beat the price of Alien Bees. They aren't the very best, but they are extremely good for what they cost. For speedlights, my only experience is with the Canon and Nikon versions. I've heard of people having good experiences with Metz and other third party brands, but I don't know much about them.
Keep in mind that it isn't just the lights you'll need to buy. You also need to buy stands for holding up the lights, stands for holding up backgrounds, backgrounds, and light modifiers (umbrellas, softboxes, gels, etc). You don't need everything out there just to get started, but you'll at least need the basics. I would start with nothing less than a single light, either a shootthrough umbrella or softbox, a large reflector (which could just be a large white posterboard or a white painted section of foam board), a background (which could be a sheet), some way to hang the background, and some stands for the lights.