Yes to the TFSA. Stuff it to the maximum. Since there's a good chance she'll live another three decades, the GICs are too risky as she's likely to run out of money. You need some equities for growth and inflation protection. You're reading the Canadian Couch Potato - figure out your mother's risk tolerance (psychological and situationally) and invest according to that.
The money is going to be in her name, so is she likely to contact the brokerage to sell her investments to access the cash? (Hopefully not.) If not, then you can work out a system to withdraw cash regularly to give her an allowance. Otherwise, you may need some other way to prevent her from spending it all in one go (if she wants that assistance to her willpower).
For the other $100k or so, it's important to know how much she's going to be collecting from CPP, OAS, and GIS. Investing that money could produce taxable income that claws back her OAS/GIS benefits. Is she considering buying another (modest) home? That could be one way to tie up the money (unless she takes out a home equity line of credit or reverse mortgage) while still having it provide for her (eliminating some shelter costs). Plus, any capital gain on her primary residence is not taxable (so no claw back concerns).