Mainly it being a Digital SLR means you have much more control over the pictures you take. Its generally very good in fully auto mode but the real improvements come when you start working in things like Shutter priority and Aperture priority. That will allow you to create much better images.
If the manual is anything like the one for the 400D then a read through that will give you a decent enough basis for getting started
I bought my wife the same camera. As Jimmymac said, the main advantage is the ability to take manual shots digitally. She loves photography, but she got sick of taking her film to the shop for development.
How would I know if the Rebel is a 350D or 400D? What's the difference?
The advantage of a DSLR is that you can change the lens's so you can get better lense's for different jobs. There is no shutter lag and you change lots of options.
the xt is the same except for a couple small differences that I really can't remember at the moment, shes gonna like the camera though it's a very good camera.