Hey Dot Car -
So sorry this has happened to your wife's site. I didn't click through because of it being compromised, but here are my thoughts and a bunch of resources for you:
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Put up a Temporarily Unavailable page. If you're on Wordpress, use a plugin like this: http://wordpress.org/extend/plugins/maintenance-mode/
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Change all FTP, database, and other passwords. If you don't know how to do this, you should contact your host to get them to help you (most have 24hr help).
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Follow these steps from Google (I don't think you have to worry about the Open Redirects) - http://support.google.com/webmasters/bin/answer.py?hl=en&answer=163634
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Here's a really good list of things to check for Wordpress: http://ocaoimh.ie/2008/06/08/did-your-wordpress-site-get-hacked/
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And an older one, but still good: http://smackdown.blogsblogsblogs.com/2008/06/24/how-to-completely-clean-your-hacked-wordpress-installation/
Unfortunately, the hard thing about a hacked site is that they could have done a multitude of things. I suggest starting with the .htaccess file to make sure it was not hacked, then you'll have to dig deeper into the database. Have you been backing up your database frequently? I hope so. It will make restoring the site a lot easier (aka if you have the backup from two weeks ago, it would be better to lose a couple of weeks of content than to have a hacked site).
Otherwise, if the .htaccess file is not your issue, you'll have to clean the database, looking for things like<iframe%, <noscript%,="" or="" display%="" that="" may="" be="" in="" your="" wp-posts="" database="" table.<="" p=""></iframe%,>
I hope this helps.
John
