Hi there,
not sure if you are still looking for a bike but here's some info that may be useful. I am similar in height to your wife (a shade over 5 ft 1) and have pretty balanced proportions, ie. leg length vs torso length etc. From my measurements using the competitivecyclist.com website this is the geometry recommendations. I know that everyone is different, but this might be useful as a starting point for getting the right size frame:
XC
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Standover Height Range: 27.4 - 28.0 inches
Virtual Top Tube: 20.8 - 21.2 inches
Stem Length: 7.9 - 9.5 cm
BB-Saddle Position: 61.3 - 62.8cm
Saddle-Handlebar: 45.3 - 46.9 cm
All Mountain Fit
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Standover Height Range: 27.4 - 28.0 inches
Virtual Top Tube: 20.4 - 20.8 inches
Stem Length: 5.4 - 7.8 cm
BB-Saddle Position: 56.8 - 62.8 cm
Saddle-Handlebar: 43.4 - 45.2 cm
I ride a small
2009 specialized safire and also have a kona blast HT (14" frame) that I started out on, both are a pretty good fit for me.
+1 on the specialized saddles. I have an ariel on my mountain bike and a Jett on my roadie. I am a size 6 and need the 143 size saddle so sit bone width not always related to overall size.
One other thing to look out for is shifters - having ones that you can swap to the other side of your brake levers is great (eg. XT or the newer SLX). With small hands I find it hard to get both brake levers and shifters where you can reach them best. having adjustable reach brake levers and shifters with some adjustment options helps a lot.
I found my knees got banged up quite a bit starting out. I bought some knee pads (661 kyle strait) that fixed the problem and gave me more confidence to try new things. Also running a lower tyre pressure made a world of difference to how often I crashed. I weigh 47kg and run 25psi both front and back (with tubes) and don't get any pinch flats. Go as low as you can get away without pinch flatting, especially on the front.
Enough from me for now