Create a new account on the old computer and give it administration privledges. Log on as that user. Open File Explorer. Click on tools > folder options > View. Scroll down and click on 'Show hidden files and folders' and uncheck 'Hide protected operating system files....' Click the 'Apply to all folders' button at the top. Click Yes. Click 'OK' button at the bottom. This will expose the folders holding your email and contacts. They will initially be hidden on new computer setups.
Copy C:\Documents and Settings\<Wifes user name> folder to the external drive.
Create wife's account on new computer and give admin rights. Create your account on new computer with admin rights. Log on new computer as wife, install programs.
Open Office and set up email. Important! This gets office setup initially.
Copy Favorites, documents, desktop folders to corresponding folders on new computer. Some folder names have been slightly changed (Documents vs. My Documents) but they hold the same data.
Office email is stored in folder on external drive at \Documents and Settings\<Wifes user name>\Local Settings\Application Data\Microsoft\Outlook\Outlook.pst Address book is in C:\Documents and Settings\<Wifes user name>\Application Data\Microsoft\Address Book\<Wifes User Name>.wab Copy these files to new computer in the same directory. Follow directions above about getting hidden files and folders exposed.
Should be good to go. Anything you miss is still on the old computer. Copy them to CD and move to new.
This is how I do it, but I've been doing it like this for years, so I am familiar with any problems that might arise. Questions? PM me.