I would be concerned that the condition of her house was "saying" something about the condition of her life. But, housekeeping is a very subjective thing. I might htink her house was a little cluttered or dingy, but OK. Soemone who is an OCD neat freak might think it was terrible.
Having been a visiting nurse, there have to be actual safety issues for CPS to get involved. "Open electrical panel"...is that a dangerous plug or the actual electircal panel box with all the breakers or fuses, which is in the kids' bedroom? Or is it a plug with a loose faceplate??? The stove with 2 burners not working...well, 2 years ago DH & I cooked Thanksgiving dinner for 15 on an avocado green stove that only had 2 burners working...hence the reason we redid the kitchen shortly thereafter!
Kids sharing a bedroom? Well, I don't see this as any huge issue unless they are sharing a bed. If they practice allowign each other privacy while changing clothes and such, it's really not the worst thing in the world. I had an older brother...I occasionally saw him go from the bathroom to his bedroom in his boxers. Trust me, I'm not scarred for life.
My point is that you need to step back and say "Is this really dangerous or is it just not up to my standards of housekeeping?". And if it's really dangerous, then why would think of calling CPS rather than trying to help your sister first?? Maybe she has a drinking problem? Have you ever talked to her about it, offered support? Have you spoken to the kids...they're not little babies, they could know enough to be telling you information that might help you help her. Maybe she's depressed, maybe they are having financial difficulties, maybe there's a million reasons why they aren't keeping up their house.
As far as my own husband not "allowing" people to come to our house...well, that wouldn't happen. It's my house too, and if I wanted someone there,they'd be there. Of course, I wouldn't tolerate my husband being furious at me for something my sister was doing that he disagreed with. I tell him where he could stuff his attitude. Sounds liek you ought to do a bit of work in your own home before you go ragging at your sister.