I'm in SE PA so very much similar road conditions: mostly a bomb-run with some sections of smooth pavement.
I did what's called the NC Rick mod: I cut off the tighter coiled progressive section of the springs and used PVC to adjust the length and preload accordingly. My Gold valves are set at 3.5 turns and I use 15wt oil with +10mm over the factory level (can't remember off the top of my head what that is at the moment). I'm 160 with gear and tend to ride on the more aggressive end of the spectrum and it's much better than stock and I have 30mm of sag as well. Very much personal preference though. Race Tech recommends a .90 for my weight and style whereas Sonic recommends a .95. You be the judge.
I'd suggest running the stockers (springs) with Gold Valves at 2.5 to 2.75 turns (They come wound at 2.5 IIRC) and use 10 wt oil if she's light. By cutting the springs, I increased the rate to .95 because I'm only using the linear end of the spring. You can also just cut the coils till you find a sweet spot, I just went right for all of them. The internals of the fork will need to be modified (the orifice in the bottom of the legs drilled a little bit bigger) so that the Gold Valve will handle the compression duties, rebound will be handled by oil viscosity. Those things make a huge difference in how the forks work, before investing in springs, see if the stockers will work first. If you want adjustable preload, SV650 caps fit onto the tops of the tubes but they're kinda pricey. PVC works fine for that but a bit more tedius.
The B12 shock should be fine, best part is that it bolts right in, no mods. Stock B4 is 305mm eye to eye while a 1st gen B12 is 306 so ride height should remain the same. You get a stiffer spring (which will be softened slightly by the linkage) as well as adjustable rebound. Also, no need to lower the forks in the triples to compensate (I did just to quicken the front end a touch). I think that once you get the front end dialed in, the stiffer rear will match up just fine, again, personal preference. I found the rear shock was a joke as well, big improvements to be had by swapping out.
The GSXR1100 rear is 10mm longer which raises the rear an inch and change. You have to do some slight machining to get it to shoe in but is nice for all the adjustability. If I were to do it again, I'll probably opt for one of the newer GSXR shocks and mod/relocate accordingly for the plain reason that they're newer and more plentiful.
I wouldn't even hesitate doing the Gold Valves, they're a revelation. Since they do all of the compression work, the forks end up becoming more plush and controlled versus stock. You're taking the forks down anyway to redo the seals, might as well go full boat. The B12 shock, a HUGE improvement, should be fine and a better set of bars, she'll be cornering with the best of them. A set of Pilot Powers and she'll be asking for rear sets.
Best of luck!
-Randy
One last thing: the pipe on her bike should have a compression strap where the sleeve meets the midpipe to seal it. I don't know if yours came with it, but you can probably cheat with a properly sized hose clamp and some hi-temp copper silicone.
