I do not know much about grant writing but I do know about scholarship writing. It is vital to have a good essay. When I competed for my scholarship, I had to stand out from a crowd of over 600 people and I believe it was the essay that did it. I used a book called
Write You Way Into The Graduate School of Your Choice by Donald Asher. While most of the book aims at grad school entrance essays there is a section on scholarships and fellowships. Even the grad school essays helped me with the scholarship essay.
http://books.google.com/books?hl=en&id=g28gN7qo_OoC&dq=write+your+way+into+the+graduate+school+of+your+choice&printsec=frontcover&source=web&ots=Omkx45cMPm&sig=bvEWU62TAK7BnvMSVVprgFG9Pgg#PPR5,M1I found my scholarship by searching the Internet. I wound up on a site which offered scholarships for a medical condition I have, and then I just followed the directions and applied. Several months later I learned that I had won and the money was sent directly to my school. Since I am an education PhD student there was little funding beyond a small fellowship I received. This scholarship really helped.
There are quite a few option for funding outside the actual school itself but she would have to be resourceful and willing to spend time really looking. She can use some of the scholarship search databases online (MAKE SURE SHE USES A BOGUS EMAIL ACCOUNT!!!). My scholarship was listed in all of them. Simply Googling the word scholarships can lead you to them. She can apply for things based on her sex, interests, race, medical conditions, religion, sports interest, and the list goes on. Some of the awards are hefty and some are only a few thousand. Every little bit helps.
I wish your niece good luck.