A number of factors play into this, so it isn't a cut-and-dry answer. Not a lawyer or tax accountant, but this is my limited understanding.
Most institutions that manage IRAs will take the 10% penalty off the top of any disbursement and give it to the IRS. So, withdrawing the money early and counting on death to beat the penalty isn't a smart move (in most cases). It might be easier to get hold of the institution and set it up as a Transfer-on-Death account. Upon notification of the death of the principle owner, the account automatically transfers to the beneficiary. From my understanding, when this happens, the money can be transferred out of the account without any penalty, and there is no inheritance tax if under a certain level (not sure what the level is, as it is one of the things that changes every couple of years, depending on who holds the majority in Congress).
As for the wife being responsible for taxes/penalty, yes, she will be held responsible if she has filed a Joint return. She will have to file a final return in which she will 'settle up' his part of the account, which will account for any early withdrawal penalty, income taxes, inheritance taxes and everything else the IRS takes when someone dies.