People often mistakingly think that Apple drop the price of the older model, they never have. What they do is run down the inventory, and shift the new stock to they're reserve stock for repairs/ exchanges.
The new ones are being announced on the 22nd of October. The rumours are that the Mini will go Retina and get the new A7 chip that's running in the new iPhone 5S. The full sized iPad will get a smaller bezel, very much like the mini iPad, which will make the device both smaller and thinner. The new iPad will get either the new A7 chip, or it's rumoured to be getting an A7X. The X standing for improved graphics performance.
There have been plenty of leaks on the net, so it's safe to say the rumours are likely to be spot on, especially with the decrease in dimensions for the regular iPad. The only doubt is whether the mini will go 'retina' or not.
One thing to be aware of with Apple is that they typically have a policy of being able to return the device if you're not satisfied within a month of purchase. What I'd do is this, go into the store and clarify what the return policy is. Then state that you're not sure how much storage you would require, go for a storage size you don't want. Take the device home, give it to her and then take it back for a swaps-e in a couple of weeks when the new one comes out.
I've done this my self when buying an iPad for my self, I took it back and opted for the larger sized one. Apple are pretty spot on with the customer services side of things, but again clarify what the returns policy is and maybe speak to a manager just to be sure.
Final thing to remember, if you are going to take Apple care out you need to take it out at the point of purchase or within one month of the device being bought. It's now called Applecare +, and it's replaced the older version of Applecare.