My gym has a Silver Sneakers class which is geared towards older gym goers and is less intensive. You may want to see if you have any in your area. Most places (even the local county classes) usually have senior classes or beginner's or intros to take and see what she likes.
The most important thing in any class at any age is proper form so the trainer suggestion is a good one if you can afford it or just showing up early and introducing yourself to the teacher so she or he knows you need some set up and guidance during the class. They are happy to do it.
And they have no problem with you not taking the entire class but just doing what you can and then leaving when you feel you need to. I left my very first ride/spin class (actually my very good teacher threw me out) after 4 songs and said I needed to work into it and anything else I was trying for the first time slowly. It was good advice.
My first thought was water aerobics too. That is highly recommended if you have an injury or issues with joints. Pilates or yoga are also good for joint issues as well but you need to be comfortable on the floor.
The treadmill and bikes, depending on her pain threshhold, could be very aggravating to her knees. And they are cardio activities although you can pace yourself and control the resistance and speed.
Tell her to try a little bit here and there, see what speaks to her, and then dive in, slowly. She'll find what she likes and what her body can handle and as she gets stronger, she'll be surprised at how much more she wants to try.