1)can she start up a business under her own name. i.e 49% share in limited liabilty company.

Yes she can with some limitations i.e will not be allowed to be an authorized signatory on the company's immigration dept authorised signatories card.

2)During the intial stages of business untill it starts to generate reasonable profit, can she work for an employer on part time/full time basis

Yes she can as long as she is holding the Ministy of Labor work permit.