Whatever the repo fees are is besides the point. If she is underwater and can't afford $500 month, the fees could be $100, $1000 or $10,000 and it's all the same problem. She can't afford it. This hurts the institution who handed her the keys and hoped she would pay.
People walk away from varying levels of debt all the time without declaring bankruptcy. This is a likely scenario: she stops paying. They come get the car. Her finance company sends a series of "Final" notices and calls her a couple times hoping she'll pay. Then they'll sell the debt to a collection agency for pennies on the dollar. Those folks will call, send threatening letters etc. They'll try to wear her down with talk of ruined credit. They'll also negotiate. But you can't get blood from a stone. They may eventually secure a judgement against her & her estate, but they won't be able to garnish her SS income. If the amount is low enough, and it probably is, they'll write it off.
Keep in mind, however, there is more to your cyber friend's situation than you know. There may be a savings account, home equity, off-spring, a partner, etc.. SHE signed up for really high car payments a decade into AARP membership eligibility. She didn't do that in a vacuum. If her financial situation made such an extravagant car payment reasonable while employed, but she is actually able to get by on $1500/month, what has she been doing with the difference? Keep in mind that non mortgage debt payment should never exceed 10% of your monthly income. $500/month is only acceptable if she is netting over $5000 month take home pay and no other non-mortgage debt. If her income while working is that high, but she could really manage on $1500, where is all the other $3000 per month going? Savings? Or QVC/Indian Bingo/Hookers & Blow? A grandson she is putting through college?
If she simply just bought too fancy & expensive a car in the first place, she can head back to the same dealer and trade it in on something cheaper with a lower monthly payment. Yes, there will be residual debt from the fancy car built into payments on the econo box, but she wouldn't be living so far beyond her means. It really depends on the seriousness of her health problems and what transportation requirements and alternatives she has in retirement.
Under no circumstances should you offer her money to close the gap. The fact that she has some money to "pay a little extra" suggests that things aren't as bad as you've been led to believe. If she is going to walk away from the debt, paying extra now is futile and she should hoard cash. But it sounds like she believes she'll need the car (or some car) and wants to make it work. She just needs to plug the other holes in her finances and evaluate her assets versus needs.