Sort of. Converting to Roth and contributing an equal amount to traditional 401(k) will cancel out in the sense that your AGI be the same as contributing directly to Roth 401(k) and leaving the IRA where it is. However, amounts contributed to traditional 401(k) reduce the QBI deduction, so while your MAGI will the same for ACA purposes, you may owe more tax due to the reduced QBI deduction. You'll essentially have a 20% higher marginal tax bracket with traditional 401(k) vs Roth 401(k) (10% vs 8% for example).
If her solo 401(k) is at one of the places that doesn't allow Roth contributions and you don't want to move it then your suggestion isn't bad, and since 138% of FPL is below the standard deduction you won't pay any tax anyway, but it's probably not quite optimal. If you want to optimize things and her solo 401(k) isn't at a provider that allows Roth contributions I would suggest Etrade, although Vanguard and TD Ameritrade are also options.
You should do the math, but I would suggest that targeting the standard deduction plus enough self employment income not sheltered by traditional 401(k) deductions that the SE tax deduction and QBI deduction bring you back down to the standard deduction, and maybe plus enough that the Saver's Tax credit (assuming you're not withdrawing from IRAs) removes any tax due might be the way to go. This will add some "tax" in the form decreased subsidies, so you'll have to see if that's worth it for the amount you'll get in to Roth in terms of a marginal tax rate.
Also consider how big your tax deferred accounts are and how long you have to convert. Will converting only up to around the 138% FPL be sustainable, or will you have to do more later? It's usually best to keep your taxable income as even as possible rather than keeping it very low in some years, then having large spikes other years.
